PANAMA CANAL MISCELLANEOUS BEFORE THE -5, ^ ' •* <^ SUBCOMMITTEE ON THE PANAMfiSAl'' OF THE COMMITTEE ON MERCHANT MARINE AND FISHERIES HOUSE OF REPRESENTATIVES NINETY-FIFTH CONGRESS FIRST SESSION ON C.Z. BIOLOGICAL AREA AUTHORIZATION— H.R. 3348 MARCH 22, 1977 PROBLEMS OF CANAL ZONE RESIDENTS AND EMPLOYEES APRIL 12, 13, 1977— BALBOA, CANAL ZONE Serial No. 95-9 Printed for the use of the Committee on Merchant Marine and Fisheries PANAMA CANAL MISCELLANEOUS HEARINGS BEFORE THE SUBCOMMITTEE ON THE PANAMA CANAL OF THE COMMITTEE ON MERCHANT MARINE AND FISHERIES HOUSE OF REPRESENTATIVES NINETY-FIFTH CONGRESS FIRST SESSION ON C.Z. BIOLOGICAL AREA AUTHORIZATION— H.R. 3348 MARCH 22, 1977 PROBLEMS OF CANAL ZONE RESIDENTS AND EMPLOYEES APRIL 12, 13, 1977— BALBOA, CANAL ZONE Serial No. 95-9 Printed for the use of the Committee on Merchant Marine and Fisheries^ 96-549 O U.S. GOVERNMENT PRINTING OFFICE WASHINGTON : 1977 COMMITTEE OX MERCHANT MARINE AND FISHERIES JOHN M. MURPHY, New York, Chairman THOMAS L. ASHLEY, Ohio JOHN D. DINGELL, Michigan PAUL G. ROGERS, Florida WALTER B. JONES, North Carolina ROBERT L. LEGGETT, California MARIO BIAGGI, New York GLENN M. ANDERSON, California E (KIKA) DE LA GARZA, Texas RALPH H. METCALFE, Illinois JOHN B. BREAUX, Louisiana FRED B. ROONEY, Pennsylvania BO GINN, Georgia GERRY E. STUDDS, Massachusetts DAVID R. BOWEN, Mississippi JOSHUA EILBERG, Pennsylvania RON DE LUGO, Virgin Islands CARROLL HUBBARD, Jr., Kentucky DON BONKER, Washington LES AuCOIN, Oregon NORMAN E. D'AMOURS, New Hampshire JERRY M. PATTERSON, California LEO C. ZEFERETTI, New York JAMES L. OBERSTAR, Minnesota WILLIAM J. HUGHES, New Jersey BARBARA A. MIKULSKI, Maryland DAVID E. BONIOR, Michigan DANIEL K. AKAKA, Hawaii PHILIP E. RUPPE, Michigan PAUL N. McCLOSKEY, Jr., California GENE SNYDER, Kentucky EDWIN B. FORSYTHE, New Jersey DAVID C. TREEN, Louisiana JOEL PRITCHARD, Washington DON YOUNG, Alaska ROBERT E. BAUMAN, Maryland NORMAN F. LENT, New York DAVID F. EMERY, Maine ROBERT K. DORNAN, California THOMAS B. EVANS, Jr., Delaware PAUL S. TRIBLE, Jr., Virginia Carl L. Perian, Chief of Staff Ernest J. Corrado, Chief Counsel Frances Still, Chief Clerk W. Patrick Morris, Chief Minority Counsel Subcommittee on Panama Canal RALPH H. METCALFE, Illinois, Chairman ROBERT L. LEGGETT, California GENE SNYDER. Kentucky DAVID R. BOWEN, Mississippi ROBERT K. DORNAN, California CARROLL HUBBARD, Jr., Kentucky BO GINN, Georgia PHILIP E. RUPPE, Michigan LEO C. ZEFERETTI, New York (ex officio) JOHN M. MURPHY, New York (ex officio) Terrence W. Modglin, Professional Staff Bernard Tannenbaum, Consultant Nicholas T. Nonnenmacher, Professional Staff, Minority (H) CONTENTS CANAL ZONE BIOLOGICAL AREA AUTHORIZATION Page Hearing held— March 22, 1977 1 Text of— H.R. 3348 2 Reports from — General Accounting Office 3 Interior Department 5 Panama Canal Company 6 Smithsonian Institution 8 Statement of — Challinor, Dr. David, Assistant Secretary for Science, Smithsonian Institution 11 Jameson, John F., Assistant Secretary for Administration, Smith- sonian Institution 11 Rand, Dr. A. Stanley, Assistant, Smithsonian Tropical Research Institute 11 Rubinoff, Dr. Ira, Director, Smithsonian Tropical Research Institute. 11 Prepared statement 15 Additional material supplied — Smithsonian Institution : Contract No. 1, informal translation by the Embassy 49 Cooperative research with universities and other organizations in foreign countries 76 Current and future research projects conducted by Smithsonian scientists on Barro Colorado Island 65 Examples of STRI research with applications to resource man- agement, disease control, wildlife conservation, food produc- tion, and other areas 53 Fellowships at STRI 61 Future status of Barro Colorado Island 72 Origin of purchases for Barro Colorado Island 69 Papers Published Annually by employees and associates of the Smithsonian Tropical Research Institute 24 1976 25 1975 36 1974 41 1973 46 Proposed capital projects 22 Questions of Subcommittee answered by Dr. Ira Rubinoff 85 Research projects currently under investigation by visiting scientists on Barro Colorado Island and anticipated end- points 63 STRI-Visitor data 57 PROBLEMS OF CANAL ZONE RESIDENTS AND EMPLOYEES Hearings held — April 12, 1977 99 April 13, 1977 175 Statement of — American Federation of Teachers, expanded statement of local 29 336 Anderson, Luis, interpreter, Panama Canal Atlantic Side Dock Worker's Union 340 President, Local 907, Armed Forces employees union 343 Baglien, David, Local 14, American Federation of Government Employees 345 (HI) IV statement of — Continued American Federation of Teachers — Continued Page Blenman, Samuel H., president, Paraiso Civic Council 126 Boreham, Dr. Melvin, president, Coco Solo-France Field Civic Council 139 Delgadc, Jose L., General Secretary, Panama Canal Atlantic Side Dock Worker's Union 340 Drummond, William R., president, AF&GE, Local 1798 206 Fulton, Mrs. Patricia, president, Pacific Civic Council 139 Gaskin, Edward A., assistant regional director. National Mari- time Union in Latin America and the Caribbean 176 Goldson, Robert S., Vice President, Pacific Region, Local 900, American Federation of State, County, and Municipal Employees 185 Gordon, Clarence G., president, Santa Cruz Civic Council, Canal Zone 127 Graham, Alfred, president. Canal Zone Central Labor Union and Metal Trades Council 206 Green, Harold B., Jr., president, Gamboa Civic Council 139 Johnson, Eugene A., president, Congress of Latin American Civic Councils 124 Kennedy, Mrs. Charlotte, president, Cristobal-Margarita-Brazos Heights Civic Council 139 Lioeanjie, Rene, regional director for the National Maritime Union in Latin America and the Caribbean 176 Mauge, Saturnin G. president. Local 900, American Federation of State, County, and Municipal Employees 185 Metcalfe, Hon. Ralph H., a Representative in Congress from the State of Illinois 123 Morrissey, Captain Joe, vice president, Panama Canal Pilots Association 363 O'Donnell, James J. president. Local No. 14, American Federation of Government Employees 345 Parfitt, Harold R., Governor of the Canal Zone, and president of the Panama Canal Company 100 Sheppard, Ralph, president, American Federation of Teachers, Local 29 206 Simpkins, Talmage E., executive director of the AFL-CIO ^laritime Committee 176 Sinclair, William H., area director, American Federation of State, County, and Municipal Employees, AFL-CIO 185 Valentine, Captain R.D., past president, Panama Canal Pilots Association 363 Williams, Frenando, Panama Canal Atlantic Side Dock Worker's Union 340 Williams, J. R., president, Panama Canal Pilots Association 363 Windle, Dale, president, Gatun Civic Council 139 Additional material supplied — Drummond, William R. : Articles of the 1972 political constitution instituting a non- discriminatory system of employment in the Republic of Panama 251 Chart of Government of Republic of Panama 269 Communist and front organizations and participants 286 Key Communists 270 List of important offices and office holders in the Republic of Panama 276 Newspaper clippings 245 News releases of the Inter- American Development Bank 288 PubUc witnesses— March 30, 1977 233 Statement of events (summarized) of activities that led to my resignation from the Canal Zone Government 217 Statement in response to inquiry of Communist influence in the Panama labor force 236 The Communist path to power in Panama 260 Gordon, Clarence G. : Bachelor quarters vacancy bulletin No. 137 377 Family quarters vacancy bulletin No. 37 379 V Additional material — Continued O'Donnell, James J.: Ccurt case — Espinoza et vir v. Farah Manufacturing Co., Inc__ 387 Recommendations of the AFL-CIO Committee on Panama Canal Treat}' negotiations 348 Panama Canal Company: Assurances for present employees of the Panama Canal/Canal Zone Government under a new Panama Canal Treaty 103 Sinclair, William H.: Workers' Buying Power in Major Cities of World 381 Williams, Capt. J. R. : Treaty position paper statement on early retirement 369 Treaty position paper of Panama Canal Pilots' Association 372 Communications submitted — Boreham, Dr. Melvin: Letter of March 23, 1977, to Harold R. Parfitt 152 Davis, Diana R. : Letter of March 11, 1977, to Lt. Gen. D. P. McAuUfife 169 Letter of March 14, 1977, to Hon. Gene Snyder 168 Drummond, William R. : Letter of March 26, 1977, to Gov. Harold R. Parfitt 224 Letter of April 21, 1977, to Gordon M. Frick 227 Letter of April 21, 1977, to William F. Kessler^ 225 Fulton, Patricia: Letter of March 11, 1977, to Hon. M. G. Snyder 160 Green, Harold B., Jr. and Mrs. Patricia Fulton: Letter of March 28, 1977, to Harold R. Parfitt 231 Kessler, W. F.: Letter of May 3, 1977, to William R. Drummond 226 Metcalfe, Ralph H. : Letter of May 24, 1977, to James J. O'Donnell 382 O'Donnell, James J. : Letter of April 13, 1977, to Ralph H. Metcalfe 362 Letter of April 30, 1977, to Hon. Ralph H. Metcalfe 383 Parfitt, H. R.: Letter of September 8, 1975, to Kenneth H. Hannah 339 Richbourg, Donald E. : Letter of March 23, 1977, to William R. Drummond 223 Sheppard, Ralph O, : Letter of April 14, 1977, to Representative Ralph Metcalfe 335 Sinclair, William H. : Letter of April 12, 1977, to Hon. Ralph H. Metcalfe 192 Williams, Capt. J. R. : Letter of April 11, 1977, to Representative Ralph H. Metcalfe 367 Letter of April 15, 1977, to Representative Ralph H. Metcalfe 371 Letter of May 1, 1977, to Representative Ralph H. Metcalfe 368 Digitized by the Internet Archive in 2013 http://archive.org/details/misceOOunit CANAL ZONE BIOLOGICAL AREA AUTHORIZATION TUESDAY, MARCH 22, 1977 Subcommittee on Panama Canal, Committee on Merchant Marine and Fisheries, U.S. House of Representatives, Washington, D.C. The Subcommittee met in Room 1334, Longworth Building, begin- ning at 2:07 p.m., Ralph H. Metcalfe, Chairman of the Subcommit- tee, presiding. Mr. Metcalfe. The Subcommittee on Panama Canal will come to order. Distinguished guests from the Smithsonian Institution, ladies and gentlemen: This afternoon the Subcommittee will hear testimony from the representatives of the Smithsonian Institution on the bill H.R. 3348. This bill would raise the present annual limit on funds authorized for Barro Colorado Island in the Canal Zone to $600,000. The present limit of $350,000, as contained in Title 20 of the U.S. Code, was legislated in 1965. This Subcommittee has held no hear- ings on Barro Colorado Island since the 1965 legislation, so this is the first time in at least twelve years we have had an opportunity to examine the management and the financial needs of this island, which is officially called the Canal Zone Biological Area. In my view, therefore, these are important hearings. The Senate paissed legislation very similar to H.R. 3348 in the 94th Congress. Unfortunately, that Senate-passed legislation was referred to this Subcommittee during the last month of the delib- erations of the 94th Congress. Since no hearings had been conducted on the Canal Zone Biologi- cal Area by either House or Senate in the 94th or many previous Congresses, we thought it would be premature to pass legislation without some public examination of the status of the Island of Barro Colorado. Thus, we did not act last year. Today is the time for that public examination which we believe ought to occur before deliberations on H.R. 3348. After today's hearing, the Subcommittee will proceed to study and analyze all the data presented orally by the Smithsonian Institution as well as all data submitted for the record of the hearing. We hope to take whatever action is appropriate by May 15 in accordance with the Budget Control Act. (1) 2 I want to make it clear that the Subcommittee is proud of the Canal Zone Biological Area and the personnel who have managed it over the years. Clearly this area is a focal point for scientists all over the world who wish to do tropical research. Clearly there has been very important research which would not have been possible without the facilities at Barro Colorado Island. I know that the testimony we receive today will bring out these facts. At this point I ask unanimous consent that the bill, H.R. 3348, and such executive agency reports as we have received or will receive on this matter be inserted in the record. Are there any objectives? Hearing none, it is so ordered. [Bill H.R. 3348 and executive agency reports follow:] 0.)TH CONGRESS V V n n A r% u.s^o. jj^ 3348 IN THE HOUSE OF REPRESENTATIVES February 9, 1977 Mr. Metcalfe (by request) intioducod the following bill; which was referred to the Committee on Merchant Marine and Fisheries A BILL To amend the Act of July 2, 1940, as amended, to increase the amount authorized to be appropriated for the Canal Zone Biological Area. 1 Be it enacted ^by the Senate and House of Representa- 2 lives of the United States of America in Congress assembled, 3 That section 7 of thCAct of July 2, 1940 (20 U.S.C. 79e) , 4 as amended by Public Law 89-280, be further amended 5 by striking out "$3'50,000," and inserting in lieu thereof 6 "1600,000,". I COMPTROLLER GENERAL OF THE UNITED STATES WASHINGTON, D.C. ZOMB B-188652 GG7-175 APR 1 9 1977 The Honorable John M. Murphy Chairman, Committee on Merchant Marine and Fisheries House of Representatives Dear Mr. Chairman: By letter dated March 16, 1977, you requested our comments on H.R. 3348, a bill to increase the amount authorized to be appropriated annually for the Canal Zone Biological Area from the present limit of $350,000, established in 1965, to $600,000. The Canal Zone Biological Area is located in the Panama Canal Zone on Barro Colorado Island (BCI) . It is part of the Smithsonian Tropical Research Institute (STRI) which conducts research there and in other tropical areas, principally in Central and South America. The annual budget justifications of the Smithsonian do not show BCI as a separate line item; the amounts requested are included in the salaries and expenses appropriation justification under the line item for STRI. The Smithsonian does not maintain separate accounting records for BCI. An informal budget is prepared each year to show the estimated amounts to be expended for BCI and a cost finding system is used to relate these costs to the appropriation authorization limitation. For fiscal year 1976, this system showed operating costs of $285,254 for BCI. In reviewing the costs allocated to BCI for fiscal year 1976, we noted several problems in determining the amounts to be charged to the appropriation authorization limitation. For example, the full amount expended to install telephone facilities, and for materials, supplies and contract services to renovate a tramway was not charged to such limitation. Instead, a prorated amount based on the estimated useful life of these items was charged. 4 Also, no indirect costs--such as a portion of the salary of the Director and administrative personnel at STRI and the costs incurred by Smithsonian employees in Washington, D.C., who provided support services--were charged to this limitation . We recommend that the Committee report on this bill make clear whether the annual appropriation authorization limitation is intended to include the total obligations incurred for construction and renovation as well as those for salaries and expenses, and which, if any, indirect costs are chargeable to such limitation. We have no special information on the need for the increase in the authorization. The enactment of this bill would not result in any additional costs by the General Accounting Office. fll»P«t7 Comptroller General of the United States 5 United States Department of the Interior OFFICE OF THE SECRETARY WASHINGTON, D C. 20240 Honorable John M. Murphy QiairnBn, ODninittee on Merchant Marine and Fisheries House of Representatives Washington, D. C. 20515 Dear Mr. Chairman: Your Ooimdttee has requested the views of this Departnent on H. R. 3348, a bill "lb amend the Act of July 2, 1940, as amended, to increase the amount authorized to be appropriated for the Canal Zone Biological Area." The bill does not appear to relate to any matter vdthin the juris- diction of this Department or to affect any matter upon which the Department would be in a position to give helpful information or advice. Accordingly, we have no oaiment to offer with respect to the inerits of the bill. Vie welooitE the opportxjnity to sutitdt reoannendations on any measure viiere possibly the activities of the Department may be involved, or %rfiere its esqperience may be of value. The Office of mnagenent and Budget has advised that there is no objection to the presentation of this report from the standpoint of the ikJministration's program. 6 CANAL ZONK GOVERNMENT OrrioB or tbm Oovbrnor BAIAOA HKIOHT8, OAIfAI^ 7.0KB APR 2 8 1977 Honorable John M. Murphy Chairman, Committee on Merchant Marine and Fisheries House of Representatives Washington, D. C. 20515 Dear Mr. Murphy: This is in response to your request of February 16, 1977, for a report on H. R. 33 48, a bill "To increase the amount authorized to be appropriated for the Canal Zone Biological Area, " The bill would amend the Act of July 2, 1940 (20 U. S. C, 79e), as amended, by increasing the amount of the annual appropriation from $350, 000 to $600, 000. The Canal Zone Biological Area (Barro Colorado Island) was designated as a wildlife preserve and study area in 1923. It was placed under the administrative control of the Smithsonian Institution from 1946 until 1966 at which time the Smithsonian Tropical Research Institute assumed that responsibility. The island has acquired a worldwide reputation as a tropical field research station at which a large number of scientific studies are carried out. According to our agency environmental control personnel, these studies are crucial to the understanding of changes occurring in tropical areas of the world. The station is ideally located for continuing research on a diversity of terrestrial and marine projects. While the Canal agencies are cognizant of the significant role of the island in the areas of tropical research and conservation, neither the Panama Canal Company nor the Canal Zone Government exercises responsibility for the funding or operation of the Canal Zone Biological Area. Consequently, these agencies have no basis upon which to comment concerning the necessity for the proposed legislation. 7 APR 2 8 1977 Honorable John M. Murphy The Office of Management and Budget has advised that it has no objection to the presentation of this report to your committee. Sincerely yours. H. R, Parfitt Governor of the Canal Zone President, Panama Canal Company 8 I SMITHSOXIAX IXSTITITIOX March 17, 1977 Honorable John M. Murphy- Chairman Committee on Merchant Marine and Fisheries U. S. House of Representatives Washington, D. C. 20515 Dear Mr. Chairman: Thank you for your letter of February 16 requesting the comments of the Smithsonian Institution on H. R, 3348 a bill to amend the Act of July 2, 1940, as amended, to increase the amount authorized to be appropriated for the Canal Zone Bio- logical Area. The Act, as effectuated by Executive Order 8515, established the Canal Zone Biological Area as an independent \init with its own Board of Trustees and an annual appropriation authorization of up to $10,000. The Act also established a trust fund within the U.S. Treasury for the deposit of future donations to the facility and of fees charged to visiting scientists as a means of additional support. The functions and authority of the Board were transferred to the Smithsonian Institution by Reorganization Plan No. 3 of 1946 and are recited in 20 U.S. C. 79. The Cansd Zone Biological Area, which is essentially Barro Colorado Island located in Gatun Lake, is now an integral part of the Smithsonian Tropical Research Institute (STRI). The activities and programs of STRI, which are focused on tropical biology, extend to areas throughout Central and South America, as well as to the Old World tropics, and include facilities in Panajna at Ancon, Galeta, and Naos, and in Cali, Colombia. The operations of STRI are governed by the general authorities of the Smithsonian (20 U. S. C. 41 et seg. ) as well as that cited previously. 9 The Barro Colorado Island reserve was initially created in 1923 by decree of the Governor of the Canal Zone at the behest and under the aegis of the Institute for Research in Tropical America, an organization composed of several independent research institutions, including the Smithsonian, for the study of tropical flora and fauna. The cooperating institutions each contributed to its funding and admin- istration, and by 1940 more than 400 scientific papers had been pub- lished on the research carried out there. It had become a valuable educational facility for teachers and students from around the world, and in order to ensure continued preservation and conservation of the Island's natural features, as well as adequate funding for research pro- grams and maintenance of the facility, a more formal entity was deemed necessary by the cooperating institutions. With the support of several Government departments that had benefitted from the facility's research efforts, it then turned to the Congress for assistance, and the Act of July 2, 1940, ensued. The Act was amended by P. L. 89-280, approved October 20, 1965, in order to raise the limit on appropriations from $10,000 to $350,000. Although current obligations are within the statutory limit (the FY' 77 budget estimate for STRI is $1, 465, 000, of which $327, 000 will be obligated for activities related to Barro Colorado Island), increasing costs and needed capital improvements suggest that the limit will be reached in the near future. Furthermore, the General Accounting Office has suggested that indirect costs associated with Barro Colorado be applied to its account. It has not been our past practice to do this. We have instead chosen to subsume these costs within the general administrative expenses of STRI as a whole. To apply indirect costs, as suggested by the General Accounting Office, to operations for FY '77 would exceed the existing limit and, based on current estimates, will exceed the limit of $600, 000 proposed in H. R. 3348 in the near future, thus requiring further Congressional action to once more raise the authorized ceiling. We would, therefore, recommend that consideration be given to the possibility of raising the limit to $750, 000 or to removing it altogether. 10 The Office of Management and Budget advises that there is no objection to the bill or the submission of this report from the standpoint of the Administration's program. Sincerely yours, S. Dillon Ripley \ Secretary Mr. Metcalfe. I also ask unanimous consent that additional material relevant to H.R. 3348 which has been submitted to the Subcommittee in the last year be inserted in the record. Are there any objections to that? Hearing none, it will be so ordered. [The material was placed in the record files of the subcommittee.] Mr. Metcalfe. The principal witness for the Smithsonian Institu- tion today will be Dr. Ira Rubinoff, Director of the Smithsonian Tropical Research Institute, which manages the Canal Zone Biologi- cal Area. Accompanying Dr. Rubinoff are Dr. A. Stanley Rand, Assistant Director of the Tropical Research Institute, Dr. David Challinor, Assistant Secretary for Science, and Mr. John F. Jameson, Assis- tant Secretary for Administration of the Smithsonian Institution. We welcome all of you here today. I would like to ask who will be the first witness. Mr. Snyder. Mr. Chairman? Mr. Metcalfe. I recognize the distinguished minority Member, Mr. Snyder. Mr. Snyder. Thank you, Mr. Chairman. I want to take this opportunity to welcome Dr. Rubinoff and the other people from the Smithsonian Institution on behalf of the minority, and I appreciate this opportunity to learn more about your operation in the Canal Zone. It has been a couple of years since I have been in the Canal Zone. I never really had a good opportunity to learn what the Smithsonian was doing down there. One of the questions on the mind of everybody who has any interest in the Canal Zone is one that I hope you will address yourself to today, and that is, what will happen to the facility in the event of a treaty. The public press has indicated that the eight points of the Kissinger-Tack Agreement in the negotiations include the idea of turning the Zone over to the Panamanian government within three 11 years after the ratification of the treaty and the operation of the Canal after twenty years. I hope you can address yourself to that as well as the justification for the additional expenditure you seek, which, of course, is the primary purpose for which we have gathered here today. I know that we will want to scrutinize the latter as well as looking into the idea of what happens to this facility and our investment there in the event of a treaty. We want to look at it probably a little bit more so than usual because of Mr. Carter's campaign commitments to attempt to go toward zero base budgeting during his tenure in office, and that makes us all want to go back and scrutinize the expenditures. I appreciate the opportunity of being here with you. I have another meeting at three o'clock, so I will not talk any longer. Mr. GiNN. Mr. Chairman? Mr. Metcalfe. Mr. Ginn. Mr. Ginn. I only want to join you and Mr. Snyder in welcoming Dr. Rubinoff and his associates. Your very fine reputation precedes you and I, like Mr. Synder, would like to know what would happen to Barro Colorado Island in the event the treaty that is in the news is consummated. Mr. Metcalfe. Dr. Rubinoff, do you wish to be the leadoff witness in this proceeding? Dr. Rubinoff. Yes. STATEMENT OF DR. IRA RUBINOFF, DIRECTOR OF THE SMITHSONIAN TROPICAL RESEARCH INSTITUTE; ACCOMPA- NIED BY DR. A. STANLEY RAND, ASSISTANT OF THE SMITHSONIAN TROPICAL RESEARCH INSTITUTE; DR. DAVID CHALLINOR, ASSISTANT SECRETARY FOR SCIENCE, SMITHSONIAN INSTITUTION; AND MR. JOHN F. JAMESON, ASSIS- TANT SECRETARY FOR ADMINISTRATION, SMITHSONIAN INSTITUTION Dr. Rubinoff. Thank you, Mr. Chairman. I appreciate the opportunity to appear before you today in sup- port of H.R. 3348, which would raise the amount authorized to be appropriated for the Canal Zone Biological Area. The Canal Zone Biological Area, which is essentially Barro Colorado Island, located in Gatun Lake in the Canal Zone — it is this (indicating) area in the center of the lake, the largest island in the lake is for scientific and administrative reasons, and by means of a process which I shall describe shortly, an integral part of the Smithsonian Institution's Tropical Research Institute. An increase in the limit on appropri- ations authorized is needed in order to continue operating Barro Colorado as a tropical reserve and research station and to permit a modest program of reconstruction. Barro Colorado Island was formed when the Chagres River was dammed in 1914 to create Gatun Lake during construction of the Panama Canal. In 1923 a group of botanists, zoologists, and medical scientists, who had been brought to the Isthmus of Panama by Colonel William A. Gorgas to investigate diseases such as yellow 95-549 O - 77 - 2 12 fever, malaria, and the plague, petitioned the Governor of the Canal Zone to reserve an area in the Zone for scientific research. The petition was successful, and the Governor offered the largest island in Gatun Lake to the scientists on which a 6,000 acre reserve and research station was established. Barro Colorado Island, as it was called, was put under the general supervision of the Institute for Research in Tropical America, a unit of the National Research Council, and the first Resident Naturalist was Dr. James Zetek, a specialist on the Anopheles mosquito, who combined administration of the reserve with his continuing work for the Department of Agriculture. The expenses of the station in the twenties and thirties were paid by subscriptions from a number of North American universities and institutions; fees from visiting scientists; and the generosity of Dr. Thomas Barbor, the Director of the Museum of Comparative Zoology at Harvard, who had provided the initial funds to buy out the three farmers who had settled on the island before it became a reserve. By 1940 Barro Colorado had acquired a worldwide reputation as a tropical field station, and publications about its flora and fauna had made it one of the best known pieces of tropical real estate on earth, which, in turn, made it valuable for further research. In that year. Congress authorized the President to establish the Canal Zone Biological Area as a separate agency under a board of directors that included the Secretaries of War, Agriculture, and Interior; the Secretary of the Smithsonian Institution; the President of the National Academy of Sciences; and three eminent biologists. The Act of July 2, 1940 sought to preserve and conserve the natural featurs of the Island in order to provide an undisturbed place for scientific research and authorized $10,000 for the adminis- tration of the Act and the maintenance of a laboratory and other facilities. Under Reorganization Plan No. 3 of 1946 the functions for the Board of Directors of the Canal Zone Biological Area were transferred to the Smithsonian Institution. The tropics provide unusually favorable opportunities for studies of a variety of subjects and problems of both theoretical interest and practical importance. Generally, these are most productively investigated by comparative methods. To utilize effectively the rich scientific resource represented by Barro Colorado Island — a moist lowland habitat — and to provide an appropriate structure within which to pursue comparative studies of other regions and habitats such as highlands, grasslands, mangrove, coral reefs, and islands, in the Old World as well as the New, the Board of Regents of the Smithsonian Institution created the Smithsonian Tropical Research Institute on April 18, 1966. It was entrusted with the administration of the Canal Zone Biological Area; the development and maintenance of marine labo- ratories on both the Atlantic and Pacific Coasts of Panama; and the encouragement and support of research throughout the tropics. It is important to understand the tropics for a variety of reasons, among which is the fact that this region cotains the most rapidly growing segment of the human population, and tropical peoples are now changing their environment at an unprecedented rate. We 13 must understand the complex ecological interactions of tropical forests and coral reefs if we are to mitigate man's increasing impact on these unique habitats and preserve a reservoir of genetic diver- sity for future generations. In addition, the tropics contain more species of animals and plants than any other region on earth. For example, there are more species of birds in Panama than in all of the United States and Canada. Indeed, most of the birds inhabiting North America in the summer are migrants from the tropics, merely using the north for nesting. The fauna and flora of Barro Colorado Island are particulary rich in species, and typical of what similar habitats used to be elsewhere in Panama. There are approximately 1,300 species of vascular plants, and certain species of mammals and birds that are hunted elsewhere are more tame and abundant on Barro Colorado Island. There are about 465 species of land vertebrates recorded from the Island; 310 species of birds (some 200 species breed there), 65 species of mammals, 58 species of reptiles, and 32 species of amphibians. Several hundred people from the United States and foreign uni- versities and research institutes visit Barro Colorado Island each year, involved in one way or another with the Smithsonian Tropical Research Institute's major functions: research, education, and conservation. Most research on Barro Colorado is done by biologists interested in ecology and in the behavior of the island's plants and animals. However, work is also done by physiologists, anthropologists, psy- chologists, geologists, geographers, and geneticists. Barro Colorado Island is attractive to research workers because of the fifty-year accumulation of information about a protected forest preserve that stands a reasonable chance of remaining undisturbed forest; living conditions that are healthful and moderately comfort- able; and a community of biologists with which to exchange ideas. The Smithsonian supports the basic maintenance and operating costs of the station, but researchers pay their own living expenses and a laboratory fee. Support for the research itself comes from many sources, such as Smithsonian fellowships or grants from the National Science Foundation, National Institutes of Health, and private foundations. In 1965 the level of appropriations authorized for the Island was raised from the original $10,000 to $350,000 and we are now seeking a further increase essentially to keep pace with inflation and to provide for some necessary capital improvements on Barro Colorado. Over the past twelve years costs such as fuel, food, utilities, and salaries associated with Barro Colorado Island have increased. As an example, salaries of launch operators, cooks, and game wardens have increased in a range between 88 and 150 percent since 1965. Furthermore, the introduction of game fish into Gatun Lake has dramatically increased the use of the area for recreational pur- poses. The increase in population pressure has required STRI to employ additional game wardens to protect Barro Colorado Island against poaching and trespassing. With respect to capital improvements, there is a need to gradu- 14 ally convert the existing wooden structures on Barro Colorado to cement construction in order to provide more sanitary and easily maintained accommodations to preclude periodic replacement caused by termite and dry rot damage. Additionally, there has been a significant trend toward longer term investigations by scientists who need to study variations between the wet and dry seasons and environmental differences from one year to another. Thus, housing more substantial than that which serves scientists on short-term studies, unaccompanied by their families, is required. A listing of capital projects proposed through fiscal year 1982 is attached to this statement and I shall be happy to discuss these inwhatever detail the Subcommittee may require. In the past it has not been our practice to ascribe to Barro Colorado Island any indirect costs, electing instead to subsume these within the general administrative expenses of STRI as a whole. However, the General Accounting Office has recently sug- gested that such costs be appropriately attributed. While we are certainly willing to accet that suggestion, we have not yet determined a methodology for doing so. However, applica- tion to the current year's operations will probably exceed the existing limitation on appropriations, and will exceed the limit of $600,000 in H.R. 3348 in the near future. We would, therefore, respectfully recommend that the Subcom- mittee consider the possibility of a limit on the order of $750,000 or the prospect of removing the limit altogether in view of Barro Colorado's integral relationship to STRI. In closing, I would like to comment briefly on a matter of obvious concern, the future status of Barro Colorado Island in light of the current treaty negotiations. It is our hope that, should a treaty be concluded placing the Canal Zone under the responsibility of the government of Panama, the Island would remain a reserve under Smithsonian Institution custodianship and supervision. Its existing status could continue under international agreement and mitht also be protected under the terms of a contract recently signed by the Smithsonian Tropical Research Institute and the Government of Panama which gives to STRI official recognition and a number of specific benefits such as tax and customs exemptions for scientific activities carried out in the Republic Panama. Mr. Chairman, attached to my statement is a list of proposed capital projects and expenditures for Barro Colorado Island for fiscal year 1974 projected through 1982, which I would like to include in the record with your permission. Mr. Metcalfe. It will be done, unless there are objections. [The complete statement of Dr. Rubinoff, together with attach- ments follows:] 15 Statement op Dr. Ira Rubinoff, Director of the Smithsonian Tropical Research Institute Thank you, Mr. Chairma.Ji. , . • > . ' ^ I appreciate the ppportunity to. appear befqre you today in support of H. R^3348 which wGuld raise the amount authorized to be appropriated for the Canal Zone Biological Area. The Canal Zone Biological Area, which is essentially Bairrp Colorado Island^ located in Gatun Lake in the Canal Zone, is for scientific^ and adminiatrative reasons, and by means of .. a process which I shall de9i:i!ribe dhbrtly, an integral part of the Smithsonian Institution's Tropical Research Institute>. An increase in the limit on appropriations authorized Is needed in order to .cojitinjie operating Barro _ . Colorado as a^ tropical; re«erve aiod research station and to permit ^'modest program of recoi^stnictioir, j^/'r -" . " - Barro Colorado Island was formed when the Chagres River was dammed in 1914 to create Gatun Lake during construction of -the iPanama Canal. In 1923 a grotip of botanists* zoologists, and medical scientists, who had been brought to the Isthmus of Panama by' Colonel William A. Gorgas to investigate diseases such as^yellow fever, malaria^ and -the plague, petitioned the Governor of the Canal Zone' to reserve an area in the Zone for scientific research. The petition was successful, and the Cover noj* offered the largest island in Gatun Lake to the scientists on which a 6,000 acre reserve and research station was established. Barro Colorado Island, as it was called, was put under the general supervision of the 16 Institute for Research in Tropical Anierica, and the first Resident Naturalist was Dr. James Zetek, a specialist on the Anopheles mosquito, who combined administration of the reserve with his continuing work for the Department of Agriculture. The expenses of the station in the twenties and thirties were paid by subscriptions from a number of North American universities and institutions; fees from visiting scientists; and the generosity of Dr. Thomas Barbour, the Director of the Museum of Comparative Zoology at Harvard, who had provided the initial fxinds to buy out the three farmers settled on the island before it became a reserve. By 1940 Barro Colorado had acquired a worldwide reputation as a tropical field station, and publications about its flora and fauna had made it one of the best known pieces of tropical real estate on earth, which, in turn, made it valuable for further research. In that year Congress authorized the President to establish the Canal Zone Biological Area as a separate agency under a board of directors that included the Secretaries of War, Agriculture, and Interior; the Secretary of the Smithsonian Institution; the President of the National Academy of Sciences; and three eminent biologists. The Act of July 2, 1940 sought to preserve and conserve the natural features of the Island in order to provide an undisturbed place for scientific research and authorized $10, 000 for the administration of the Act and the maintenance of a laboratory and other facilities. Under Reorganization Plan No. 3 of 1946 the functions of the Board of Directors of the Canal Zone Biological Area were transferred to the Smithsonian Ins titution. 17 The tropics provide unusually favorable opportunities for studies of a variety of subjects and problems of both theoretical interest and practical importance. Generally, these are most productively investigated by com- parative methods. To utilize effectively the rich scientific resource rep- resented by Barro Colorado Island--a moist lowland habitat -- and to provide an appropriate structure within which to pursue comparative studies of other regions and habitats such as highlands, grasslands, mangrove, coral reefs, and islands, in the Old World as well as the New, the Board of Regents of the Smithsonian Institution created the Smithsonian Tropical Research Institute on April 18, 1966. It was entrusted with the administration of theCanal Zone Biological Area; the development and maintenance of marine laboratories on both the Atlantic and Pacific Coasts of Panama; and the encouragement and support of research throughout the tropics. It is important to understand the tropics for a variety of reasons, among which is the fact that the region contains the most rapidly growing segment of the human population, and tropical peoples are now changing their environment at an unprecedented rate. We must vinderstand the complex ecological interations of tropical forests and coral reefs if we are to mitigate man's increasing impact on these unique habitats and preserve a reservoir of genetic diversity for future generations. In addition, the tropics contain more species of animals and plants than any other region on earth. For example, there are more species of birds in Panama than in all of the United States and Canada. Indeed, most of the birds inhabiting North America in the summer are migrants from the tropics, merely using the north for nesting. 18 The fauna and flora of Barro Colorado are particularly rich in species, and typical of what similar habitats used to be else>vhere in Panama. There are approximately 1, 300 species of vascular plants, and certain species of mammals and birds that are hunted elsewhere are more tame and abundant on Barro Colorado Island. There are about 465 species of land vertebrates recorded from Barro Colorado; 310 species of birds (some 200 species breed there), 65 species of mammals, 58 species of reptiles, and 32 species of amphibians. Invertebrates are present in a proportional variety. Several hundred people from the United States and foreign universities and research institutes visit Barro Colorado Island each year, involved in one way or another with the Smithsonian Tropical Research Institute's major functions: research, education, and conservation. Most research on Barro Colorado is done by biologists interested in ecology and in the behavior of the island's plants and animals. However, work is also done by physiologists, anthropologists, psychologists, geologists, geographers, and geneticists. Research currently in progress can be arranged under topics such as social behavior, including communication, sociobiology, and social organization; population ecology, including population fluctuations and control mechanisms; forest function and structure, including phenology, regrowth, primary productivity, and nutrient cycling; and complex inter- specific relationships which include coevolution of plants and animals; predator-prey, parasite-host, and herbivore-plant interactions; pollination and seed-dispersal systems; and competition and resource partitioning between and within systems. 19 Some studies have continued for more than a decade, conducted either by staff scientists or by scientists from elsewhere who visit the island repeatedly. Much research is done on a long-term basis by scientists who come for a year or two, live on the island, and devote full-time to their research. These are usually graduate students working on doctoral theses, recent graduates doing postdoctoral studies, or senior scientists on sabbatical leave. Short-term scientists who stay a week to three months also play an important role. They may be doing a limited research project; part of a project, much of which is done elsewhere; or a pilot study for a long-term project. Visitors who stay only a day or so are seldom able to do research, but are able to learn enough about the island to plan a return visit of longer duration. Barro Colorado Island is attractive to research workers because of the fifty-year accumulation of information about a protected forest preserve that stands a reasonable chance of remaining undisturbed; the juxtaposition of modern laboratory facilities and undisturbed forest; living conditions that are healthful and moderately comfortable; and a community of biologists with which to exchange ideas. The Smithsonian supports the basic maintenance and operating costs of the station, but researchers pay their own living expenses and a laboratory fee. Support for the research itself comes from many sources, such as Smithsonian fellowships or grants from the National Science Foundation, National Institutes of Health, and private foundations. 20 In 1965 the level of appropriations authorized for the Island was raised from the original $10,000 to $350, 000, and we are now seeking a further increase essentially to keep pace with inflation and to provide for some necessary capital improvements on Barro Colorado. Over the past twelve years costs such as fuel, food, utilities, and salaries associated with Barro Colorado Island have increased. As an example, salaries of launch operators, cooks, and game wardens have increased in a range between 88 and 150% since 196 5. Furthermore, the introduction of game fish into Gatun Lake has dramatically increased the use of the area for recreational purposes. The increase in population pressure has required STRI to employ additional game wardens to protect Barro Colorado Island against poaching and trespassing. With respect to capital improvements, there is a need to gradually convert the existing wooden structures on Barro Colorado to cement construction in order to provide more sanitary and easily maintained accommodations and to preclude periodic replacement caused by termite and dry rot damage. Additionally, there has been a significant trend toward longer term investigations on Barro Colorado Island by scientists who need to study variations between the wet and dry seasons and environ- mental differences from one year to another. Thus, housing more substantial than that which serves scientists on short-term studies, unaccompanied by their families, is required. A listing of capital projects proposed through fiscal year 1982 is attached lO tais statement and I shall be happy to discuss ^hese in whatever detail the subcommittee may require. 21 In the past it has not been our practice to ascribe to Barro Colorado Island any indirect costs, electing instead to subsume these within the general administrative expenses of STRI as a whole. However, the General Accounting Office has recently suggested that such costs be appropriately attributed. While we are certainly willing to accept that suggestion, we have not yet determined a methodology for doing so. However, application to the current year's operations will probably exceed the existing limitation on appropriations, and will exceed the limit of $600,000 proposed in H. R. 3348 in the near future. We would, therefore, respectfully recommend that the subcommittee consider the possibility of a limit on the order of $750,000 or the prospect of removing the limit altogether in view of Barro Colorado's integral relationship to STRI. In closing, I would like to comment briefly on a matter of obvious concern, the future status of Barro Colorado Island in light of the current treaty negotiations. It is our hope that, should a treaty be concluded placing the Canal Zone under the aegis of the Government of Panama, the island would remain a reserve under Smithsonian Institution custodian- ship and supervision. Its existing status could continue under international agreement and might also be protected under the terms of a contract recently signed by the Smithsonian Tropical Research Institute 22 and the Government of Panama which gives to STRI official recognition and a number of specific benefits such as tax and customs exemptions for scientific activities carried out in the Republic of Panama. This concludes my statement, Mr. Chairman, but I would welcome the opportunity to respond to any questions you may have. PROPOSED CAPITAL PROJECTS 197^ lastallatioa of sciergsQcy generator 1975 .Eenorratioa of main laboratory building Reconstruction of boathoase- and pier 1976 Traasray renoTation. This is a vrinca draa cart to pull supplies fron the lake level to the top of the hill. It replaces a systea built in 1927 which is now unsafe. Phase I Installation of a telephone systea to replace • "present \inreliable radio system. . 10,000 28,000 17,000 27,500 1«D,000 1977 Trasway renovation. Phase II 9,97^ Const, of Pjiel Storage Area 1,800 Const, of Silherglied insect. 2,500 Resiodel lever house 1,500 Rebuild carpentry storage area 2,000 3arber house 1,500 Kitchen renovation 1,500 ZMA House- • - 500 Easkins house 500 ~ 22,000 19^3 Renovation "of Patrocinio's house 2,000 Renovation of Vitola 's house * . ' 15,000 1979 Replacecsnt of donaitory built in 192^; 125,000 1930 Replacenent of dining hall and l-iitchen facilities with Eore codem sanitary facilities 169,500 1931 Replacecent of current septicvtaric sewage systaa with nodem non-polluting sanitary treatment facility 50,000 Cocrpletition of remodeling of laboratory building 35,000 Construction of new long-term staff scientist residence 35,000 1952 Reconstruction of animal holding facilities 35,000 Construction of plant growth facilities 20,000 Construction of forest canopy access towers and wallc«iy 25,000 23 EZPENDITOaES FOR. BAR20 COLORADO ISLAND FY 74-FY 82 OPERJVTING (1) EXPENSES CAPITAL PROJECTS SOURCE OF FUNDS TOTAL FY 7 4 221 ,000 > 1 u , u u u- S & E s y 231 000 FY 7 5 $ 235 ,000 45 000 S & E $ 280,000 FY 1 $ 277,000 9 67 00 S & E s 3 44,000 FY 77 $ 305,000 $ 22,000 S & E $ 3 2 7,000 FY 78 $ 335, 170 _ $ 17,000 R & R $ 352,000 FY 79 $ 369,000 $ .125,000 R & R $ 494,000 ^TY 80 $ 405,500 $ 169,500 R t R $ 573,000 FY 81 $ 446,000 $ 120,000 S S E/R & R $ 586,000 ■ 32 - -$ 491,000 . $ 80,000 S & E $ 571,006 (1) Actual /figures up to FY 76 'from there we assume a - lOZ iucreaent over nrAvious year Dr. RuBiNOFF. I would also like to include our brochure on STRI; a statement on applied STRI research; charts on vistors to BCI and STRI, together with data on States, universities and organizations; a publications list for 1960-76; a copy of the contract between the government of Panama and STRI; a list of current research projects by visiting scientists; and a list of current projects by Smithsonian scientists. The brochure, together with some pictures, the statement on applied research, and some visitor data have been supplied sepa- rately to members of the Subcommittee for their consideration and review. This concludes my statement, Mr. Chairman, but I welcome the opportunity to respond to any questions that you may have. Mr. Metcalfe. If there are no objections, then this additional material would be included in the record as so requested. Not hearing objections, it is so ordered. [The brochure on STRI was placed in the record files of the Subcommittee.] [The other information just referred to follows:] 24 PAPERS PUBLISHED ANNUALLY BY EMPLOYEES AND ASSOCIATES OF THE SMITHSONIAN TROPICAL RESEARCH INSTITUTE Attached is a bibliography of publications based upon the work of the staff, associates, and visiting scientists at the Smithsonian Tropical Research Institute. Those related to work done on Barro Colorado Island are indicated in the left hand margin by S (STRI staff scientist) and A (STRI associate). The latter includes a variety of affiliations such as pre- and post-doctoral fellows receiving support from the Smithsonian Institution. 25 I STRI PUBLICATIONS 1976 ;--v..v „ , I . .Abela, Lawrence G. "Cosparacive Species Richsass and Constant Envlroa- "tMnts; Coral-Associaced Decapod Cruscaceans." Science , voluae 192, c'jicber 4233 (1976), oagea 461-463. Abela, Lawrence C. , and v^acdall X. Pacton. 'Tna Size of Coral Heads and Che Coisauaicy. Biology of Associated Decapod CruscaceaM Journal of Bio^eo^raohT ^ volxane 1, nxjaber 1 (1975), pasea 35-47. A::irews, Robia M. "Growrh Race in island and Mainland Ar.oline Lizards." Coueia . nxiaber 3 (1976), pages 477-432. Arosesena H. , Oalva H. "Absorcion de Radiocarboco en el Golfo de Panasa." Thesis, Fundacion Univeisidad de Bogoca Jorge Tadeo Lozano, Facnltad " ^•;.;d3.Ciencias del Hat," 1975. >"-v •. ' ■ -^.r -'^'V: Bertsch, Eaas. "DisCributional and Anatosical Cbsarvations of Barthalla tivsala (O^isthobraschia: Xotasoidaa) The Mautilus , vcluse 89 (1975), • pages-. 124-12o"i. '.' ^ - - ' . . . V "?rav Data on Tbrca callista (Gastropoda: Capulidaa)." Tae Valiger. volts* 13,msibar 1. (1975) , pages 99-lCO. ' -'i/J . Birtceland, Charles, Aaada A. Reioer, and Joyce Rede=ske Young. "Survey of - ?iarine Cocsivaicies in Panaaa and H>:pari=encs -.^ii- Oil/' Ecological Rase arch S arias , EPA-6C0/3- 76-023 , iS76, 177 pages. Bonaccorso, Frank J. "Foraging and Raprsducciva Hcolog^/ in a Cosaunicy of Bac3 in Panana." Tnssis, Univarsirr of Florida, Cainas-rilla, 1975. Soydan, Ihornas C. "Zuc "arfly Paiaiabiiicy ar.-i Miziicry: E::parirsn:3 -:itri 26 Carpanalla, Paul J. "The Evolution of Mating Syscei=s in Teaperac* Zoa« Dragonflies (Odonata: Anisoptera) II: Libelltila luctoc3a (Buro*iscar) Bahaviour , voluaa 5^, nusbar 4 (1975), pages 278-310. C:?ike, Richard. "El Hoisbre y la Tierra ea el Fanarsa Prehis tSrico." Ra-va.3ta Nacioaal de Cultura , nuajber 2 (1976), pages 17-3S. Croat, Thocias 3. "Flacourtiacaae New to Panasia: Casearia and Xylosxa ." .-Linals of the >lissouri Botanical Gard5:>7 - '^l'^a'"6ZV riiic^ 2 (1975)v * pages 434-490.. : . ^ "Phenological Bahavior of Habit and Habitat Classes on Barro Colorado Island (Panama Canal Zone)." Biotropica , voluna 7, nunber 4 (1975) , pages 270-277. ' '/ ^J -. ' ► "A P^ccnsideration of Trichilia cioo (A. Juss.) C-DC. (Meliaceae) ." Arvnali of t>ia\Mis3ourl Botanical jGarcan , voluna 62, ntrrier 2 (1975), pages 45 1-4? 5. Dresslar, Robert L. "It Grcvs U? in the Trees; Really It Does." Marie Selbv Botanical Garden Bulletin , volume 2 (1975), pages 22-23. . \ "Zl Genero Nide^." Orauicea (>lax.) , vcline 5 (1975), pages 235«239. _________ -'*Mot as Sobre Moisenclaturas de las Orqxjidaceas VI." Orquldea (Max.), volu2:e 5, nucber 5 (1975), pages 143-146. . "rne Use of Pollinaria in Orchid Systemacics . " In First Sytroosiua on the Scientific Aspects of Orchids. Southfield, llichigen , edited by H. Harry Szaant and Janes War.ple. University of Detroit, 19 76. . "Jacquin naTzes again."' Tarron . volunie 24, ni:rber 5/6 (1975). 27 . "Proposal for the Conservacioa of the Geaeric Najaa 1779 Oncidiun Swartz (Orchidaceae) with a Conserved Type Species, Oacidiua altissiuavan Sv." Taxon, volume 24^ number 5/6 (1975), pages 692-693^ . "Proposal for the Conservation of the Generic Name 1393b Phra^nipedium Rolfe (1898) (Orchidaceaa) , against Uropediun Lindley (1846)." Taxon, volume 24, number 5/6 (1975), pages 691-692. arhard, Jlary ; Jane; West. "Bom: Sociobiology." CA review). Quarterly ; Re^Tiew of Sioloy7 . volxzsa 51, numbar 1 (1975), pages 39-92. "Zstudios da las Avispas Sociales (Hynenoptera, Vespidaa) del Valle dal Cauca. I. Objativos, Jlatodos y Notas para Facilitar la Idantification de Especies Cornvmas." Casoadasia, volume 4 . (19 75), pagas 245-267.- : erhard, TTiiliaa G. "The Ecology jand Bahavior of a Subsocial Pentatomid Bug ar.d Tvo Scelionid Wasps: Strategy and Co^-intarstratagy in a Host and its Parasites." Soithsonian Centric uticris to Zoolo^ , number 205 (1975). . "Fnotography of Orb Webs in tha Field." Bulla tin of the British Arachnolo^ical Society , volume 3 (1975) , pages 200-204.- ' : vicz, Z. M., and Biesiadka, E. "Palagic Water Mitas (Hydracariaa) and Their Effect "on the Plankton Coamrunity in -a Neotropical M3n-^^ada Laka."- Archiv fuar Hydrobiologie , volume 76, number 'l (1975), pages 65-88. -in, Patar W. "A New Shallow-Water Serolid (Isopoda: Flaballifara) frota tha Pacific Coast of Panama." Journal of '■latural History' , voluma 10, n-jmbar 1 (1976), oagas 7-16. 95-949 O - 77 - « 28 "The Coral Reef Community." Encyclopedia Britannica, Yearbook of Science and the Future , 1976, pages 202-219. Goes, R. b. "Fungi of Barro Colorado Island: New and Interesting^ H7phon7cetes." .Canadian Journal of Botany , volume 53, nu:sber 24 (1975) , pages 2927-2932. ' - " C-ore, Robert H. "Patrolisthea zacae Haig, 1968 (Crx:stacaa, Decapoda, Porcallanidaa) : The Development of Larvae in the Laboratory." Pacific Science , voluae 29, number 2 (1975), pages 131-196. Gorran, George C, Yung J. Kia and Roberta. Rub iaoff. "Genetic Ralatiooships of Three Species of Bachygobius from the Atlantic and Pacific Sides of P2^2=:a." Coneia, number 2 (1976) , pages 361-364. Gr^haa, Jaifray B. "Respiratory Adaptations of Marine Air-Sreanhing Fishas." I:: Rasclration of Azmhibious Vertebrates , edited by G. M. Hughes, ^'aw York: Acadeaic Press , 1976. .' "Hemoglobin. Concantrations of Air-3 reaching Fishes." American Zoologist , volume 16, nucber 2 (1976), page 192, abstract 73- Eerk, Kenneth L. "Community Structure and Effects of Pollution in Sea- Grass ileadows and Adjacent Habitats." I'larine Biology , volume 35, nusiar -■(1976), pages 343-357. . "Sotie Critical Consid?ration3 of the rr.aory of ^pecies Packing." Evolutionary Iheor7 , volume 1 (19 76), pages 247-253. . "Conparative Cocnrjnity Organization in Tropical and Temperate Sea-Grass ( Thai ass ia t as tudinum) Maaccws." Thasis, Tn.?. Florida State Her.ilar, Gordon L. ".-i-dapcional Significance of che Pattarr.s of Ophiuroid i Developneat." Anarican Zoolo-^ist , voiune 15 (1975), pa'^as 691-715. 29 Harriag, Joa L. "A New Genus and Spacies of Cylapiaae from Panama (Heaipcera: Miradea}." Proceedinss of the Eatoaological Society of Washington, volume 73, number 1 (1976), pages 91-94. Xarr,: Janes R- , and Frances C. James. "Eco-Qorpholosical Configuration and Convergent Evolution in Species and Communities." In Ecology and Evolution of Communities , edited by Martin L. Cody and Jared M. Diamond. ' . Caabridge, Massachusetts :. Harvard University Press, 19 75. i^ight, Dennis H. Phytosociological Analysis o£ Soaci-as-Rich Tropical rorast on Barro Colorado Island, Panaca.". Ecological ^lonographs , -oluse 45, number 3 (19 75), 'pages 259-284. . Land,L-S-, J. C. Lang, and D.J. Barnes. "Extension Rate: A Primary Control on the Isotropic Composition of West Indian .(Janaican) Sclarac-iniaa Saef Coral Skeletons." Marina Biology , volume 33 (1975), pages 221-233. " ■ ■^ " ■V Lavrence, J. M. "On the Pweversal of the Covering Response in Lyt echinus variegat'-js . (Abstract)." Florida ^raturalist , vclune 39, nxiaiber 2, 3Tr)?ie=ent 1 (1976). ./r-' Lavrence, John M. "Covering Response in Sea Urchins." Nature , . volume 262, nuEHjer 2268 (1976) , pages 490-491. • - - Leek, Claries r. "Weigjits of Migrants and Resident Birds in Panama." r'. '. Sird-3anding , volume 46 (1975), pages 201-203. Leigh, Egbert G. "Population Fluctuations, Coasaunity Stability, and En'/ironrentsl Variability." In Ecolcgy and Evolution of Communities , edited by I'.arzin L.* Cody and Jared Diatsond. Ca^ibric^e, Massachusects : -■tar---ard Iniversity ?r25s, 1975, ?.it;=3 51-73. 30 (Review) Sex and Evolutioa . by George C. Wiili*ims, Anerican Scientist , voluae 64 (1976), pages 214-216. _ "Structtire and Cliaate in Tropical Rain Forest." Annual Review of Ecology and Systematics . voluaa 6 (1975>, pages. 67-86. Linares, Olga F. "From the Late PreceraaLc to.the Early Foraative in cha . Intermediate Area: Soae Issues and i-Iachodologias ." Procaedin^ of the First Puerto Rican Syaposiua on Archaeology , report 1 (197&)» pages 65-77. • . "Aaiaales No Cooes tibles Son Teniblas." Revista. ■■acional da Culfura , nuiAer 2 (1976), pages 5-16. - Lubin, .Yaal D. - "Stabilineata and Barriar Webs in tha Orb ITzos of Argio?e- ar^gntata (Araseae, Aranaidae) on Daphne and Santa Cruz Islands, Galapagos." Journal of Arachnolcg7 , voluce 2 (1975), pages 119-125. 'i£7, liiciaal L. "Therroragulation a-d Adaocation to Zssparature in Dragonflias (Oconata: Aaisoptera) ." Zcological Monographs , voluae 46 (1976), pages 1-32. - ■ - Milton, Katharine. "Uriaa-Rubbing in the ^lanclad Howler Monkey Aluotta palliata ." Folia Prinatologica . voluae 23 (1975), pages 1Q5-112. Milton, Katharine, and Michael L. May. "Sody '..'eight. Diet and Home Range Area in Privates." Nature, voliiae 259 (1976), pages 459-':62. M:rrison, Douglas wildas. 'Tna Foraging 2aha'/ior and Feeding Ecology of A Neotropical Frxiit Bat, Artibs'js : aaaicansis . " Tnesis , Cornell University, Ithaca, N'e-v York, 19 75. 'Ic32r. Don. "3?.rro Colorado is a Nn^h's Ark It. th ; ?.aic "o r^st." ' SiTULChsonian , volune 6, nuaber 5 (1575), pa'^es 53-62. 31 ILornihaa, Martia. "Coaservatism of Displays and Cocparable Stereocyped Pactems Aaoag Cephalopods . " la Function itnd Evolution in Behaviour , edited by G. Baerends, C. Beer and A. Manning. Oxford: Clarendon Press, 19 75, pages 276-291. __. ' Tne l\sw World Primates ." Princeton, New Jersey: Princeton ibivarsity Press, 1976. " "!'otes on the Ecology and-Bah^vior of. the Pygsy Manaosec ( Cebuella ""feZiaaa ) in Azsazonian Colonbia." In ^Neotropical Prinates : Field Studies zn± Csnser^ation , edited by R. W. Thorington, Jr., and P. G. Heltne. ITational. Acadeny of, Sciences, Washiiigron, D.C., 1976, pages 79-84. 'Jilliaa IL. , and A. Stanley Rand. "Agonistic B2ha-«/ior in Nesting Igusnas: A Stochastic , Analysis of Dispute Settlecent Dominated, by :tLni=iz=cion of Energy Cost." Zeitschrift fuer Tierpsychologie , voluzia -0 (1575), pages 279-299. r^anere, ArLchcrr? J. "The Preceranic of Panana: Taa Viev from the Interior." Procaedinss of the First Puerto Pdcan STrrposiua on .Archaeology , report 1 (1975), pages 103-135. P-airiar, Aaada .A. "Description of a Tatraclita salactifera pananensis : ... Conzuairy on a Rocky Intertidal Pacific Shore of Panaaa." Marine 3iolog7 , volice 35, number 3 (1975), pages 225-233. - "Effect of Crude Oil on Corals." >!nrine Pollution Bulletin , voiu-ie 5, number 3 (1975), pages 39-43- . "Effects of Crude Oil on the reeding Beha'/iour cf the Zoanthid ?2l"rh: a ^'^riabilis . " En''/iror.-er.CEl trr^sioloz'' ?.r.d ^iochenis tr^^ , volume 5 (ir75), pages 25a-2&5. 32 . "Succession of lavertb rates in Vacant Tests of Tetraclita stalactifer panameosis ." Marina Biolo?/ , volume 35, nu=iber 3 (1978), pages 239-251. ?.2l=er, Roger D., and Anada A. Reiner. "Gieaical Control of Feeding in Four Species of Tropical Cbhiuroids of the Genus ODhioderna ." Co=raarativa Biocheaistry and Phvsiolorr , volume 51A (19 75), pages 915-927. 7^:klafs, Robert E., and Kevin C'Bourka. "Aspacc Diversity in Moths: A re-!perate-Tropical Cooparison." Evolution , volune 29, n'xsber 2 (1975), pages 313-324. ?^binson, 2-lichael H., and Thane Pratt. "The Phenology of Hexacentms -cnd'js (?. Ualker) at Wau, Papua, Ns'v Guinea (Orthoptera, Tettigoniidae) . " Psyche , "volure 82 (1975), pages 315-323. ?.cbi:^3cn, :iichael H., and Barbara Rcbinscn: "The Zc3loT7 and Behavior of "aobila rnaculara : A Supplement." Snithsonian Contributions to Zooloy/ . number 213 (1976). . "Evolution Beyond the Orb web: Tne Web of the Araneid Spider Pasilobus sp . , Its Structure, Operation and Construction." Zoological Journal of the Linnean Society , volume 56, n>^er i (1975), pages 201-314. . "Techniques in Field Studies of Spiders." Bulletin of the British Arachno logical Society , voluise 3 (1975), pages 160-155. ?.-_binoff , Ira. (Re^/iev) The Biolo.zv of Sea Snakes , by ^v-iiliam A. Dunson. Science, volume 191 (19 76), pages 555-555. 33 Scoct, Noxnsan J., Don E- Wilson, Clyde Joaes, and Robin M. Andrews. "The Gioice of Perch Dimensions by Lizards of the Genus Anolis (Rap till a, Lacertilia, Iguanidae)." Journal of Harpetoloyy > voluEe 10, nuaiar 2 (19 78), pages 75-84, Sexton, Owen J- "Black Vultures Feeding on Iguana Eggs in Panama." Anerican Midland Naturalist , volune 93, niiirier 2 (1975), pages 463-467. . Silberglied, Robert E. "Visualizati'dn aiid Recording of Longwave Ultraviolet Reflection froe Natural. Objects. Part 1." Functicnel Photography . volune 11, nuEbar 2 (19^76), pages 20, 24-29. - v . . . "Visualiziation and Recording of Longwave Ultraviolet Reflection froTa Natural Objects. Part- 2." Punctional Photoyraohy , volune 11, n^iaber 3 (1976), pages. 31-33. ■ i Soith, .Mzn. P. ".Altitudinal Seed Ecotypas in the Veneruelan --^-ndes." Az:eric3n ^iidlend Naturalist , vol-^e 9'-r (1^75), pages 247-250. "Insect Pollination and Haliotropisn in Orltroohiux lizmophilua. ',• ' \: (Co3positae) of the Andean Pararxi." Biotrooica, voluz^ 7, nuiaber 4 (1975), pages 234-236. . . "Response of Plants of an Andean Bzraza Species to an Artificial '.7et Season." bulletin of the Torrey Sotanical Club , volune 102, nuaber- 1 (1975), pages 23-30. ■ y ■ . "Vegetative ?>.aproductiva and Close Packing in a Successional Plant Species," Nature, volizne 26, number 5557 (1976), pages 232-233. Tannenbaum, Bamice Ruth. "P^procuctive Strategies in the '.■Tnite-Lines Bat." raesis, Comeii Uni-zersi.:' , Ithaca, Na-.j York, 19 75. 34 raorington, Richard W. , Jr., Nancy A. Nuckeahim, and G. Gene itoacgooAcy. "Movements of a Wild Nighc Jtonkey ( Aotus trivirgatua) . " In Neocropical Prioates: Field Studies- and Conservation , edited by R. rnoricgton, ' ; Jr., and ?. G. Heltne. National Acadeoy of Sciences, Washington, D.C-, 19 76, pages 32-34^: -j • bed, Eric S. "Vertical Hoveaents and Devalopasnt of the Prolarvaa of ' the" El"eotrid'?i3h"r Doraitator latif rons . " Cooeia, nmber 3 (1975) . pages 564-553. »■ .**Terres trial Grazing by the £as*:em Tropical Pacific Goby Cobxonallus sagitrtola ." Copeia , nirabar 2 (1976), pages 374-377. "saga, Jeffrey K., and G, Gem Idontgoaery. " Cryouosas choloepi : A Copropagoiis Moth that Livas on a Sloth." Science , voluiie 193, nu=ier i 4243 (1=75), pages 137-155. ■arr:2r, ?^berr R- , D. Rcss Robartson, and Egbert G. Leigh . "Sax Changa <.Tid Sexual Selection." Science , volure 19G , r.uzijer 4215 (1975), pages 633-738. aers, Eleanor T., and Thotaas M, Zaret. "Grazing Effects in Nannoplaakton in - Gatun Lake , Panama. " Verfaandlungen der Intemationalan Vereiniym . fuer LitJiolo^ie , volu=2l9 (1975), pages 1^50-1^33. iiliaas, Norris H. , and Robert L. Dressier. "Euglossine Pollination of Soathi^hvlua (Araceae)." Selbyana , volune 1 (1976)^ pages 349-356. i-dsor, Donald and Stephen T: Ealen. "?recacor-?rey Iniieractions of Adult and Prefledgling Sank Svallo'.vs and ---.arican Kestrels." Condor, 35 Visdsor, Donald M., editor. "Eavironceatal Hdoitoriaf and Baseline Oaca; Tropical Studies." (Compiled under the Salth) WashljigeoA^ fflidMOOitt Institution, 1975, 409 pages. ' Z^ret, Ibonas H. "Strategies for Trittwc* of fiwpllrtrrim Prey in Hoaogeneous Eavironneate.'* VertKttdltai— laCttMCioaalu Vereioigua • fuer Licaologie. voluae 19 (1975). peco U$^UM, 36 STRI PUBLICATIONS 1975 Abele, Lavrence G. The nacruran decapod Crustac-a of Malpelo Island. Smithsonian Contributions to Zoology 176: 09-85. Bertsch, Hans. Additional data for tvo dorid nudibranchs fron the southern Caribbean Seas. The Veliger 17:-l6-^17. I • . Distributional and anatcnical obsei-ratior.n of 3erthella tupala T^isthobranchia: Notaspidea). The nautilus 8?:12i*-126. . Hew data on Thyca callista (Gastropoda: Capulidae). The V-liger 18:99-100. Birkeland, Charles, Da-rid L. Meyer, James P. Stages and Caryl L. 3uford. Subtidal connmnities of I'lalpelo Island. Snithsonian Coctributicns to Zoolosy 176:55-63. A Bonaccorso, Frank J. Foraging and reproductive ecology in a coaanaity of bats in Panama. Thesis (Plr.D.) 'Jniversitv of Florida, 122p. C'2mpan«lla, Paul J. The evolution of naticg sy.^tems in temperate zone dragcnflies (Odonata: Anisoptera) II: Lii^eilula iuctuosa (Buraeister) Behaviour 5l*' 278-310. A Croat, Thomas B. and Philip Busey. Geographic3Ll affinities of the Barro Colorado Island flora. "Brittonia 27:127-135- Dana, T.F. Development of contemporary eastern Pacific ccj^ reefs. Marine Biology 33:355-371*. Dressier, Robert L. and Eric Hagster. Una especie nueva del sur de M&dco: Belleriella guerrerensis . Orquidea (Mex.) 5:35-U2. Dressier, Robert L. Nomenclatiiral notes on the Orchidaceae VI. Orquidea (Mex.) 5:1^5-lU6. . Notas sobre nonenclatura de las orqijidaceas VI. Crquidea (Mex.) 5TD»3-ll*^. and Norris H. Williams. Proposal for the conservation of the generic name 1779 Oncidivm Swartz (Orchidaceae) -vith a conserved type species, Qncidixm altissimum Sv. Taxon 2'»: 692-693. and Horris H. Willians. Proposal for the conservation of the Sen»ric name 1393b Phragmipcdiujt Rolfs (1896) (Orchi'iaceas) , against Uropedium Lindley (181*6). Taxon 2U:691-692. and Horris H. Williams. Jacquin names - again. Taxon 2l*:6U7-650. Eberhard, Mary Jane West. The evolution of social behavior by kin selec- tion. Quarterley Review of Biology 50:1-33. 37 Eberhard, William G. The ecology and behavior of e subsocial pentatonid bug and tvo scelionid wasps: rtrategy and co'interstrategy in a host and its parasites. Smithsonian Ccatributions to Zoology 205:1-39. . The "inverted ladder" orb veb Scoloderus sp. and the interme- diate orb of Eustala (?) sp. Araneae : /r-ui-idae. JoumaJi of Ilatural History 9: 93-106. A ELtoa, Charles S. Conservation and the low popxilation density of invertebrates inside neotropical, rain forest. Biological Conservation 7:3-15. Glynn, Peter W. , Deborah M. Dexter and Thomas E. Bo^vnan. ' Exirolama braziliensis f a Pan-American sand beach isopod: tajconomic status, zonation and distribution. Journal of Zoology, Lond. 175:509-521. Graham, J.B. Biological investigation of Malpelo Island, Colombia. Snithsonian Contributions to Zoology 176:1-8. . Heat exchange in yellow fin (Thannus albacares) and skipjack (Katsvwonus pelamis) tunas and the adaptive significemce of elevated body tenperattires in scombird fishes. Fishery Bulletin 73:219-229. , John H. Gee and Fred S. Robinson. Hydrostatic and gas exchange functions of the lung of the sea snake Pelamis platurus . Comparative Biochemistry and Physiology 50A:U77-^82. A Haines, Bruce. Impact of leaf-cutting ants on vegetation development at Barro Colorado Island. In: Golley, Frank B. and Ernesto Medina (eds.) Tropical ecological systems: trends in terrestrial and aquatic research. Springer-Verlag , New York. pp. 99-111. A Hespenheide, Henry A. Selective predation by two swifts and a swallow in Central America. Ibis 117:82-99. Jones, M.L. and K. Rutzler. Invertebrates of the upper chamber, Gatiin Locks, Panama Canal, with emphasis on Trochospongilia leidii (Porifera) Marine Biology 33:57-66. A Karr, James R. and Frances C. Jimes. Eco-morpho?.ogicaQ. configurations and convergent evolution in species and communities. In: Cody, Martin L. and Jared M. Diamond (eds.) Ecology and evolution of communities. Harvard University Press, Cambridge, Mass. pp. 258-291. A . Production, energy pathways, and community diversity in forest birds. In: Golley, Frank B. and Ernesto Medina (eds.) Tropical ecological systems: trends in terrestrial and aquatic research. Springer-Verlig , New York. pp.i6l-176. Kiester, A. Ross, George C. Gorman and David Colon Arroyo. Habitat selection behavior of three species of Anolis lizards. Etiology 56: 220-225. 38 A Kaight, Dennis H. A phj-iiosociolotical analysis of species-rich tropical forest on Barro Colorado Island, Paraira. Ecological Monographs i*5: 259-23U . Land, L.S., J.C. Lan^ and D.J. Barres. Extension rate: a primary control on the isotopic composition of We^t Indian (Ja^iaican) scleractinian reef coral skeletons. Marine Biology 33:221-233. , J.C. Lang and B. N. Smith. Preliminar;'- observations on the carbon isotopic composition of some reef coral tissues and symbiotic zooxan- thellae. Limnology and Oceanography 20:283-287. A Leek, Charles F. Weights of migra.nts and r-sident birds in Panama. Bird-Banding U6: 201-203. S Leigh, Egber G. Structure and climate in tropical rain forest. Annual Reviev of Ecology and Systematics 6:67-86. S . Pop\ilation fluctuations, corsiunity stability, and environmental variability. In: Cody, Martin L. and Jared M. Diaron-i (^ds.) Ecology and evolution of communities. Harvard University Press, Cambridge, Mass. pp. 51-73. Linares, Olga F. Current resesirch , Central America. Americsm Antiquity U0:239-2U0. , Payson D. Sheets and E. Jane Rosenthal. Prehistoric agriculture in tropical highlands. Science 187:137-1^5. Macintyre, Ian G. A diver-operated hydralic drill for coring submerged ' substrates. Atoll Research Bulletin 185:21-21^. Maeurda, D.B. And D.L. Meyer. The microstructure of the crinoid endo- skeleton. University of Kansas, Paleont. Contrib. 7^:1-22. McCosker, John E. and C.E. Dawson. Biotic passage throxigh the Panama Canal, vith particxilar reference to fishes. Marine Biology 30:3^3- 351. and R.H. Rosenblatt. Fishes collected at Malpelo at Malpelo Island. Smithsonian Contributions to Zoology 176:91-93. A Milton, Katharine. Urine-rubbing in the mantled howler monkey Alouatta palliata. Folia Primatologica 23:105-112. S Montgomery, G.G. and M.E. Sunquist. Iirpact of sloths on neotropical forest energy flow and nutrient cycling. In: Golley, Frank B. and Ernesto Medina (eds.) Tropical ecological systems: trens in terres- trial and aquatic research. Sprinrer-Verlag, Hew York. pp. 69-98. A Morton, Eugene S. Ecological sources of selection on avian sounds. Aaerlcao Naturalist 109:1T-3J+. 39 A Moser, Don. Barro Colorado is a Noah's ark in the rain forest. Smithsonian 6:53-62. Mo;/nihan, M. Conservatism of displays and comparable stereotyped patterns among cephalopods. In: Baerends , Gerard, Colin Beer and Aubrey Manning (eds.) F\inction and evolution in behaviour. Clarendon Press, Oxford, pp. 276-291. Rftnd, A. Stanley and Robin Andrews. Adult color dimorphism and Juvenile pattern in Anoiis cuvieri. Journal of Herpetology 9:257- 260. , George C. Gorman and William M. Rand. Natural history, behavior, and ecology of Anolis agassizi. Smithsonian Contributions to Zoology 176:27-38. Reimer, Anada A. Effects of crude oil on corals. Marine Pollution Bulletin 6:39-^3. Reimer, Roger and Amada A. Reimer. Chemical control of feeding in four species of tropical ophiuroids of the genus Ophioderma. Comparative Biochemistry and Physiology 51A: 915-927. A Ricklefs, Robert E. and Kevin O'Rourke. Aspect diversity in ffio-f:hs: a temperate-tropical comparison. E'/olution 29:313-32U. A . Seasonal occurrence of night-flying insects on Barro Colorado Island, Panama Canal Zone. Journal of the New York Entomological . Society 83:19-32. Robertson, D.R. and J.H. Choat. Protoginous hermaphroditism in fishes of the family Scaridae. In: Reinboth, R. , (ed.) Inters exuality in the anin&l kingdoa. Springer-Verlag , New York. pp. 263-283. S Robinson, Michael H. The evolution of predatory behavior in araneid spiders. * In: Baerends, Gerard, Colin Beer and Aubrey Manning (eds.) Pvmction and evolution in Behaviour. Clarendon Press, Oxford, ■pp. 292-312. and B. Robinson. Evolution beyond the orb' web: the web of the armieid s6der Pasilobus sp. , its str-acttire, operation and construction. Zoological Journal of the Linnean Society 56:301-31^. ^ Sextoa, Oven J. Black vultures feeding on iguana eggs in Panama. Aatrican Midland Naturalist 93:^63-^67. Seyaour, C, P. A. Webb, P.H. Peralta and G.G. Montgomery. Arbovirtts field studies on Panamanian sloths. Paper presented Nov. 13 at the azmual meeting of the American Society of Tropical Medicine and Hygiene, New Orleans. 9?. 40 Smith, Alan P. Altitudinal seed «;cot:rpes in the Venezuelan Andes. Aaerican Midland Naturalist 9U:2U7-250. , Insect pollination and heliotropism in Oritrophium lianophilum (Coiopositae) of the Andean paraao. Biotropica 7:28U-266. . Response of plants of in Andean paramo species to an artificial wet season. Bulletin of the Torrey Botanical Club 102:28-30. S Snith, Neal G. "Spshing noise": biological significancs of its attraction and nonattraction by birds. Proceedings of the National Academy of Sciences 72 :ll*ll-lUll4 . Todd, Eric S. Vertical movements and development of the prolarvae of the eleotrid fish Dormitator latxfrons. Copeia 19T5 :56U-568. Warner, Robert R. The adaptive signif ficance of sequential hermaphro- ditism in animals. Americ2m Naturalist 109:61-82. . The reproductive biology of the protoRinoxis hemaphrodite Piwelotaetopon pvlchnm (Pisces: Labridae). Fishery Bulletin 73: 262-281. , D. Ross Robertson cvnd Egbert G. Laigh. Sex change and sexual selection. Science 190:633-636. Wolda, Henk. Ecosystem of Malpelo Island. Smithsonian Contributions to Zoology 176:21-26. Zaret, Thomas M. and W. Charles Kerfoot. Pish predation on Bosmina longirostris: body-size selection vs. visibility. Scology 56: 232-237. February 27, 1976. 41 STRI PUBLICATIONS 1974 Abele, Lawrence G. "A new species of Seearmat S. (Bolometopus) Rubinoffonan from the Pacific coast of Panama (Crustacea, Decapoda, Grapsidae) . " ProoeedCngs of the Biological Society of Washington^ volume 86, number 27 (1973), pages 333-338. . "Taxonomy, distribution and ecology of the genus Sescaviaj (Crustacea, Oecapoda, Grapsidae), In eastern North America, with special reference to Florida". American Midland naturalist ^ volume 90, number 2 (1973), pages 375-386. w "Species diversity of Decapod Crxistaceans in marine habitats." Ecology t volume 55, number 1 (1974), pages 156-161. Abele, Lawrence G. and Robert H. Gore. "Selection of a lectotype for Megalobrachium graniliferum Stimpson, 1958, (Decapoda, Forcellanldae). " Cru8tae«ana» voltaoe 25, number 1 (1973), pages 105-106. Abele, Lawrence G., Michael H. Robinson and Barbara Robinson. "Observations on sotmd production by two species of crabs from Panama (Decapoda, Gecarclnidae and Pseudothelphusidae) . " Crustaceanat volxmie 25, number 2 (1973), pages 147-152. Bohlke, Janes E. and John E. McCosker. "Two additional West Atlantic gohles (Genus Gobiosoma) that remqve ectoparasites from other fishes." Oopeia, volume 3 (1973), pages 609-610. ; Buckman, Nancy S. and John C. Ogden. "Territorial behavior of the striped parrotflsh Scarus aroioensia Bloch (Scaridae)." Ecology ^ volume 54, number 6 (1973), pages 1377-1382. S Dressier, Robert L. ^^Elleanthjjis capitatue - A name that must be changed, or is it?" American Orchid Society Bulletin, volume 42 (1973), pages 419-420. Dressier, Robert L. and Eric Hagsater. "Una govenia nueva del Estado de Jalisco: Govenia tequilana." Orquidea (Mex.), volume 3 (1973), pages 175-183. Dressier, Robert L. and Glenn E. Pollard. "Una nueva Encyclia del sureste de Mexico." Orqutdea O^x.), volume 3 (1973), pages 272-279. Dressier, Robert L. "Is'otas sobre el g^nero Encyclia en M&tico." Orquidea (MSx) volume 3, number 10 (1974), pages 306-313. A Elton, Charles S. "The structure of invertebrate populations inside neotropical rain forest." Journal of Anir.dl Ecology, volinae 42, number 1 (1973), pages 55-104. 42 ^ Fleming, Theodore H. "Numbers of mammfll species in North and Central American forest communities." Ecology^ voltnne 5A, number 3 (1973), pages 555-563. A Gllwicz, J. "A short characteristics of a population of Proechimya eemiapi- noeaua (Tomes, 1860) - a rodent species of the tropical rain forest." Bull, de la Acad. Polorutiee de Sciences, Ser. Science Bioloay, cl. 2, volume 21, numbet 6 (1973), pages 413-A18. Glynni^ Peter William. "Ecology of a Caribbean coral reef. The Poritee reef- flat biotope: Part I. Meteorology and hydrography." Marine Biology ^ volume 20 (1973), pages 297-318. 9 . . . "Ecology of a Caribbean coral reef. The Poritee reef-flat ^ " Sd.otope: Part II. Plankton conmunity with evidence for depletion." * "Marine Biology, volume 22, number 1 (1973), pages 1-21. ^Glynn, !Peter W. and Robert H. Stewart. "Distribution of coral reefs in the Pearl Islands (Gulf of Panama) in relation to thermal conditions." Limnolpgy and Oceanography j volxjone 18, nxunber 3 (1973), pages 367-379. Gore, Robert H. and Lawrence G. Abele. "Three new* species of porcellanid crabs (Crustacea, Decapoda, Porcellanidae) from the Bay of Panama and adjacent Caribbean waters." Bulletin of Marine Science , volume 23, number 3 (1973), pages 559-573. Graham, Jeffrey B. "Heat exchange in the black skipjack, and the blood-gaa relationship of warm-bodied fishes." Proceedings of the natural Acadeny of Science, volume 70, number 7 (1973), pages 196A-1967. « "Terrestrial life of the amphibious fish Mnierpes macrooephattie.'' Marine Biology, volume 23 (1973), pages 83-91. A Hespenheide, Henry A. "A novel mini cry complex: beetle and flies." Journal' of Entomology, volume 48, number 1 (1973), pages 49-56. Kropach, Chaim and John D. Soule. "An unusual association between an ectoprocC and a sea snake." Berpetologica, volume 29, number 1 (1973), pages 17-19- Lang, Judith. "Interspecific aggression by sderactinian corals. 2. Why the race is not only to the swift." Bulletin of Marine Science, volioie 23, number 2 (1973), pages 260-279. Lehman, John T. and James W. Porter. "Chemical activation of feeding in the Caribbean reef-building coral Montastrea cavernosa. " Biological Bulletin^ volume 145 (1973), pages 140-149. S Leigh, Egbert G. "The evolution of mutation rates." Genetics Sixpplinmtt, volume 73 (1973), pages 1-18. 43 Ummrmt , Olgm F. "Current research: Lower Central America." American AnHquity, volume 38 (1973), pages 234-235. ' "Excavaciones en Barriles y Cerro Punta: nuevos datos sobre la epoca formativa tardia (0-500 D.C.) en el oeste panameno." ActoB del Tercev Sirrposio de Antropologiat Arqueologia y Etnohietoria de Panama, Octubre, 1973. . "From the late preceramic to the early formative in the intermediate area: some issues and methodologies." First Simposium of Archaeology and History , Puerto Rico, December, 1973. . "Ngawbe: Traditions and rhrtnge among the western Guaymi of Panama, by Philip D. Young. (Review)." American Anthropologist, Tolume 75, number 4 (1973), pages 1011-1012. . "Pre-Columbian man finds Central America: the archaeological bridge, by Doris Stone (Review." American Journal of Archaeology, volume 77 (1973), pages 361-362. . "Revista EspaSola de Antropologla Americana (Trabajos y conferencias), volume 6, ed. by Jose Alcina Franch." (Review). American Jourrjxl of Archaeology, volume 77 (1973), pages 253-25A. Lubin, Yael D. "Web structure and function: the non-adhesive orb-web of Cyrtophora moluccesis (Doleschall) (Aranaea:Araneidae) . " Forma et Functio, volume 6 (1973), pages 337-358. Macurda, Donald B. and David L. Meyer. "Feeding posture of modem stalked crlnoids." Nature, volume 247 (1974), pages 394-396. Ifeyer, David L. "Feeding behavior and ecology of shallow-water uns talked crlnoids (Echinodermata) in the Caribbean Sea." Marine Biology, volume 22, number 2 (1973), pages 105-129. 8 Montgomery, G.G., V.E. Cochran and M.E. Sunquist. "Radiolo eating arboreal vertebrates in tropical forest." Journal Wildlife Management, volume 37, number 3 (1973), pages 426-428. S Montgomery, G.G., A.S. Rand and M.E. Simquist. "Post-nesting movements of iguanas from a nesting aggregation." Copeia, volume 3 (1973), pages 620-622. A Morton, Eugene S. "On the evolutionary advantages and disadvantages of fruit eating in tropical birds." American Naturalist, volume 107 (1973), pages 8-22. S Moynihan, Martin H. "The evolution of behavior and the role of behavior in evolution." Breviora, volume 415 (1973), pages 1-29. 95-549 O - 77 - 4 44 Ogden, John C. and Nancy S. Buckman. "Movements, foraging groups, and diurnal migrations of the striped parrotfish Sccamee croicensie Bloch (Scaridal)." Ecology, volume 54, niunber 3 (1973), pages 589-596. Oppenheimer, John R. Social and communicatory behavior in the Cebue monkey. Pages 251-271 in C.R. Carpenter, editor. Behavioral Regulators of Behavior in Primatee. Bucknell University Press: Lewisburg, 1973. Ospina H. Mariano, Robert L. Dressier. "Orquideas de las Americas." Fondo de Publicaciones Cientificas, Medellin. Pages 1-496 (197A). Porter, James W. "Biological, physic5d., and historical forces structuring coral reef coipmunities on opposite sides of the Isthmus of Panama." Thesis 1973, pages 1-146. P6rter, James W. and Karen Porter. "The effects of Panama's Cuna Indians on coral reefs." Discovery , volume 8, number 2 (1973), pages 65-70. Ricklefs, Robert E. "Ecology." Chiron Press: Newton, Massachuset, 1973. Pages 1-861. Ricklefs, Robert E. and John Cullen. "Embryonic growth of the green iguana Iguana iguana." Copeia, volume 2 (1973), pages 296-305. Robinson, Michael H. "The evolution of cryptic postures in insects, with special reference to some New Guinea tettigoniids (Orthoptera) Psyohej volume 80, number 3 (1973), pages 159-165. . "Insect anti-predator adaptations and the behavior of predatory primates." Adas del IV Congreso Latinoamericano de Zoologia, volume 2 (1973), pages 811-836. . "The stabilimenta of Nephila clavipes and the origins of stabilimentum-building in araneids." Psyche^ volume 80, number 4 (1973), pages 277-288. . "The biology of some Argiope species from New Guinea: I. Predatory behavior and stabilimentum construction." Zoological Journal of the Linnecn Society, London. Robinson, Michael H. , B. Robinson and Yael D. Lubin. "Phenology, species diversity and natural history of web-building spiders on three trensects at Wau, New Guinea." Pacific Insects^ vol'ume 20 (1974), pages 117-163. Robinson, Michael H. and Barbara Robinson. "Ecology and behavior of the giant wood spider Uephila mac-j.lata (Fabricius) in New Guinea." ' Smithsonian Contribution to Zoology j volume 149 (1973), pages 1-76. 45 Rubinoff, Ira. A sea level canal in Panama . Theme 3 (1973). Pages 1-13, in Lee oonsequenaee biologiques dee canavx -interoceans . XVII Congre International de Zoologie, Montecarlo, 1972. Smith, Wayne L. "Recbrd of a fish associated with a Caribbean sea anemone." Copeia^ volume 3 (1973), pages 597-598. Todd, Eric S. "Positive buoyancy and air-breathing: a new piscine gas bladder function." Copeia, volume 3 (1973), pages 461-464. . "A preliminary report of the respiratory pump in the Daatyloecopidae." Copeiaj volume 1 (1973), pages 115-119. Williams, Norris H. and Robert L. Dressier. "Oncidiwn species described by Jacquin and the typification of Onoidium." Tcaony volume 22, number 2/3 (1973), pages 221-227. Willis, Edwin 0. "The behavior of ocellated antbirds." Smithsonian Contribution to Zoology j volume 144 (1973), pages 1-57. Wolda, Hindrik. "Ecology of some experimental populations of the landsnail Cepaea nemovalis (L.). II. Production and survival of eggs and jtiveniles." Netherlands Journal of Zoology j volume 32, number 2 (1973), pages 168-188. Zaret, Thomas M. and R.T. Paine. "Species introduction in a tropical lake. 7 Science, volume 182 (1973), pages 449-455. Zucker, Naida. "Shelter building as a means of reducing territory size in the fiddler crab, Uca terpsichores (Crustacea: Ocypodidae) . " American Midland Naturalist, volume 91 (1973), pages 224-236. 46 STRI Publications 1973 A Batten, Mary, The tropical forest; ante, aniaals aad plants. New York, Thomas Y. Crowell, 1973. Bohlke, James £. and John E. McCosker, Two additional %fe8t Atlantic gohies Cgenns Gobiosoma) that remove ectoparasites from other fishes. Copeia 1973 (3) c 609-610. Buckman, Nancy S. and John C, Ogden. Territorial behavior of the striped parrotfish Scarus croicensls Bloch (Scaridae). Ecology 54(6): 1377-1382. Dressier, Robert L. Elleanthas capltatus - A name that must be changed, or Is it? American Orchid Society Bulletin 42:619-420, Dressier, Robert L. and Eric Hagsater. 'Una Govenla nueva del Estado de Jalisco: GovenlA teqnilana . Orquidea (Kex.) 3:175-183, A Elton, Charles S. The structure of Invertebrate pop\ilations inside neotropical rain forest. J. Animal Ecol., 42 (1) : 55-104. A Fleming, Theodore H. Numbers of -mammal species in North and Central American forest coianunlties. Ecology 54 (3) : 555-563 . A Glivicz, J. A short characteristics of a population of Proechimys semispinosus (Toaes, 1860) - a rodent species of the tropical rain forest. Bull, de I'Acad. Polonaise de Sciences, Ser. Sci. Biol. CI. 2. 21 (6): 413-418. Glynn, Peter W. Acanthaster : effect on coral reef growth in Panama. Science 180:504-506. _. Aspects of the ecology of coral reefs in the western Atlantic region. Biology and geology of coral reefs, ed. by D.A. Jones and R. Endean. New York Academic Press, 1973:271-324, T— ^ — , — • Ecology of a Caribbean coral reef. The Porites reef-flat biotope: Part I, Meteorology and hydrography. Marine Biology 20:297-318, June. . Ecology of a Caribbean coral reef. The Porites reef -flat biotope: Part II. Plankton comnmnity with evidence for depletion. Marine Biology, 22(1):1-21. . Isopoda of the Suez Canal. Contributions to the knowledge of Suez Canal migration, ed. by F. D. Por, Israel J, Zool. 21:3-4. Glynn, Peter W. and Robert H. Stewart. Distributions of coral reefs in the Pearl Islands (Gulf of Panama) in relation to thermal conditions Llnnology and Oceanography 18 (3) : 367-379, Graham, Jeffrey B. Heat exchange in the flock skipjack, and the blood- gas relationship of warm-bodied fishes, Proc. Nat. Acad. Sci. 70C7>:1964--1973. . 47 STRI Publications 1973 cont'd. Graham, Jeffrey B, and Lawrence G. Abele. Panama Bay fish hill and crab svrarming. Smithsonian Institution. Center for short lived pheno- mena, event information report i54-73, 1618»-1619. i^ril 25, 1973. Hanbnry^Tenison, A.R. and P.J.K. Burton. Should the Darien gap be closed? Geogr. J. 139 CI): 43-52 Kropach, Chaim and John D. Soule. An unusual association between an. ectoproct and a sea snake. Herpetologyica 29Cl);17-19, Lehman, John T. and James VT. Porter, Chemical activation of feeding in the Caribbean reef -building coral Montas trae cavernosa Biol. Bull, 145:140-149. Leigh, Egbert G. The evolution of mutation rates. Genetics 73, suppl. (Fogarty International Center Proceedings 17:1-18.) LeShack, Leonard A., William R. Brinley and Dale E. Mclvor. Automatic processing of airborne remote sensing data for pattern discrimina- tion of jungle and other vegetation areas. Final report. Silver Springs, MD, Development and Resources Transportation, 1973. Lewis, Walter H. A new species of Byrsonima (Malpiguiaceae) from Panama. Brittonia 25 (3) :304-306. Linares, Olga F. Kgawbe: tradition and change among the western Guayml of Panama, by Philip D. Young. (Review), Amer. Anthropol. 75(4): 1011-1012. . Pre-Columbian man finds Central America: the archaeological bridge, by Dons Stone (Review). Amer. J. Arch., 77:361-362. . Revlsta Espanola de Antropologia Americana (Trabajos y coixf erencias) , vol. 6, ed, by Jose Alcina French. (Review). Amer. J. Arch. 77:253-254. Meyer, David L. Feeding behavior and ecology of shallow-water unstalked crinoids (Echinodermata) in The Caribbean Sea. Mar. Biol. 22(2): 105-129. Montgomery, G.G., W.W. Cochran and M.E. Sunquist. Radiolocating arboreal vertebrates in tropical forest. J. Wildl. Manage. 37(3):426-428. Montgomery, G.G,, A.S. Rand and M.E. Sunquist, Post-mesting iwryements of iguanas from a nesting aggregstion, Copeia 1973 C3) : 620-622, Morton, Eugene S. On the evolutionary advantages and disadvantages of fruit eating in tropical birds. Amer, Nat. 107:8-22, Moynihan, Martin H. Species proportions - a reply. Amer. Nat, 107:155-156, 48 STRI Publications 1973 cont'd. Ogden, John C. and Nancy S. Bucionan, Movements, foraging groups, and diurnal migrations of the striped parrotf ish Scarus croicensls Bloch (Scaridal). Ecology 5A6) :589-596. Porter, James W. Biological, physical, and historical forces structuring coral reef communities on opposite sides ot the Isthmus of Panama. Thesis (PK, D) Yale University, (photocopy.) Porter, James W. and BLaren Porter. The effects of Panama's Cuna Indians on coral reefs. Discovery 8C2):65-70, Reiner, Amada Alvarez. Feeding behavior in the sea anemone Calliactis pol3rpus (Forskal, 1775) Comp. Biochem. Physiol. 44A: 1289-1301 . Ricklefs, Robert E. and John Cullen. Embryonic growth of the green iguana Iguana iguana . Copeia 1973(2) -.296-305. Robinson, Michael H. Insect anti-predator adaptations and the behavior of predatory primates. Actos del IV Congreso Latinoamericano de Zoologia 11:811-836. Rubinoff, Ira. Biological assessment. The Panamic biota Ca revlewD. Science 179:791. • . A sea level canal in Panama, XVII Congres International de Zoologie, Kontecarlo, 1972. Theme No. 3, Les consequences biologiques des canaux interoceans, pp. Smith, Neal G. A game of brood parasitism: cowbirds versus oropendolas. Fauna A, 1973. . Spectacular Buteo migration over Panama. Amer. Birds 27:3, 1973. Smith, Wayne L. Record of a fish associated with a Caribbean sea anemone. Copeia, 1973(3) :597-598. Todd, Eric S. Positive buoyancy and air-breathing: a new piscine gas bladder function. Copeia, 1973 (3) : 461-464 . . A preliminary report of the respiratory pump in the Dactyloscopidae. Copeia 1973 (1) : 115-119. Williams, Norris H. and Robert L. Dressier. Oncidium species described by Jacquin and the typification of Oncidium . Taacon 22 (2/3) : 221-227 Wolda, Einrik. Ecology of some experimental populations of the landsnail Cepaea nemoralis CL.). II. Production and survival of eggs and j-uveniles, by H. Wolda and D.A. Kreulen. Netherlands J. Zool. 32(2):168-188. Zaret, Thomas M. and R. T. Paine. Species introduction in a tropical lake. Science 182:449-455. 49 ENCLOSURE # 2 Enclosure to A .-024 Panama INFORMAL TRANSLATION 3Y THE EMBASSY CONTRACT n Between the Government of the Republic of Panama, represented by Dr. ABRAHAM SAIED, Minister of Health, duly authorized, on the one part and which hereafter shall be denominated "The NATION", and on the other part, Dr- IRA RU3IN0FF, male, of legal age, married, a citizen of the United States of America, bearer of Passport ?Y1081171, Director of the Smithsonian Tropical Research Institute, hereafter referred to as THE INSTITUTE, acting in the name and in representation of said Institute, with duly approved by-laws and Legal Capacity C"Personeria Juridica '''3 established by Resolution ?43 of 15 November 1976, issued by His Excellency, the President of the Republic, in exercise of his legal powers and inscribed in the Public Registry, and with sufficient powers for the present act, as recorded in public docunient rl0,690, authorized on 22 November 1976, at the Fifth Notary of the Panama Circuit, registered in Volume 1299, Folio 42, Entry S117,403, under the Section of Public Persons ("Persona Comun") a contract has been agreed upon, in accordance with Law #57 of June 6, 1974 of the Republic of Panama, pursuant to the following clauses.' FIRST : The Institute will effect in the Republic of Panama, activi- ties and research of a purely scientific character in the field of tropical biology, including studies on the ecology of the Isthnus of Panama, with advance notification to the National Government, through the Ministry of Health, on the projects to be carried out, 60 days prior to the inception thereof. SECOND : The Institute will totally defray the cost of the activities and research which will take place in territory of the Republic of Panama, but is obliged to keep the Nation informed of all the activities and research and to provide to it, gratis, the results of such research. THIRD : The Institute will provide the Nation with fundamental mrornation on the ecology of the Isthmus and will offer its collaboration in the execution of such research and programs as may be agreed upon. FOURTH: The NATION authorizes the INSTITUTE to establish in the Republ ic of Panama offices, field stations, laboratories and work shops for the activities and research referred to in Clause One, and* in consideration of the benefits which the Republic of Panama will derive from the scientific activities and research work effected by the Institute, it grants the following privileges: ■ 50 ENCLOSURE • 2 Page 2 of Enclosure to Panama A -024 Exemption to th^ INSTITUTE of all the national taxes and liens, real or personal, with the exception of: 1. Indirect taxes such as are normally included in the price of merchandise or services; '2.~ Taxes' on estates ; 3. Taxes and liens on private income which originated in the national territory and such taxes on capital as are assessed on commercial investments in the Republic of Panama; 4. Taxes or assessments pertaining to private services rendered; and 5. - Registry and judicial fees, mortage and stamp tax Exemption from the obligation to pay the quotas required under the Social Security Law on salaries or emol- uments which the Institute pays its foreign scientific personnel which do not have permanent residence in the Republic. This exemption is extended to the INSTITUTE and to its said scientific personnel. Exemption from the payment of any type of customs duty or related taxes and assessments, with the exception of those expenses in connection with storage charges, transportation and analogous services for goods, equip- ment and material belonging to the INSTITUTE, and destined exclusively for use in its offices and by its officials, but title to which may not be transferred by purchase, or gratis, without prior payment of the corresponding taxes. - It is understood that should the INSTITUTE decide to construct its own buildings, it may benefit from the exoneration here granted only with respect to goods not produced in Panama; Authorization of visas and residence permits for foreign scientists and technicians which the INSTITUTE contracts, to work in Panama; 51 ENCLOSURE #2 Page 3 of Enclosure to Panama A _n9& e) Exemption to foreign scientists under contract with the INSTITUTE for services in the Republic of Panama, whose repatriation is guaranteed by the INSTITUTE, from the obligation of making a deposit for repatriation', or from any tax, duty, or assessment pertaining to immigration; f) Exemption from compliance with' the laws on protection of the national worker, with regard to the contracting by the INSTITUTE of foreign scientists and technicians. For legal purposes the INSTITUTE will advise the Ministry of Labor and Social Welfare of the arrival in the country of the foreign scientists and technicians which are contracted. In each case the status of foreign the scientist or technician must be verified. FIFTH : It is expressly agreed that the INSTITUTE is obliged to inscribe in proper form, in the Public Registry, before establishing its offices in Panama, proof of its existence and personality, and also of the appointment of its attorney, residing in the Republic of Panama, with full and sufficient authority to represent the INSTITUTE judicially or extrajudicially in all matters per- taining to its activities, properties, rights and obligations in the Republic of Panama. SIXTH ; The INSTITUTE shall be subject to the laws of the Republic of Panama and to the jurisdiction of Panamanian tribunals, and renounces recourse to diplomatic redress with reference to the rights and duties arising out of this contract, except in case of denial of justice. SEVENTH : This contract will remain in effect so long as any of Its parties does not express a desire to terminate it, which intention should be made known at least one year before it is desired that the contracts terminate. The INSTITUTE will allow the use of its laboratories ,. work shops and field stations upon request of the NATION for scientific research and work when this is possible and available. 52 ENCLOSURE i2 Page 4 of_ Enclosure to Panama A 024 In testimony of all that was expressed above, the contracting parties sign the present contract in the City of Panama on the fifth day of January of the year 1977. THE NATION THE INSTITUTE (Sgd.) Dr. ABR.AR'VM SATED Minister of Health (Sgd.) IRA RUBINOFF Director of the Smithsonian Tropical Research Institute 53 Examples of STRI Research vd.th Applications to Resource Management, Disease Control, Wildlife Conservation, Food Production, and Other Areas 1. Because of its strategic location, the research of STRI marine scien- tists was of direct use in constructing models of the possible ecological con- sequences of digging a sea-level canal on the Central American isthmus. Our efforts led to the National Academy of Sciences to recommend that such a canal not be constructed without a careful ecological survey and the inclusion of a biotic barrier to the exchange of organisms between the Atlantic and Pacific, in order to prevent such untoward consequences as the inadvertent and destruc- tive introduction of the sea lamprey into the Great Lakes by the construction of the Welland Ship Canal. 2. STRI mammalogists were examining basic aspects of biology of sloths when the most recent epidemic of yellow fever (1974) began spreading northward from the Darien jungles. Medical researchers discovered that some sloths pos- sessed a high viremia and consequently represented a potential reservoir of the disease, one which could potentially bring it into closer contact with urban human populations. STRI scientists joined a collaborative effort to establish radio-tracked sentinel populations of sloths in order to monitor the progress of the disease. 3. As a result of its long-term reserve status, Barro Colorado Island has a very large population of Howler monkeys. This species is a natural reservoir of yellow fever — which has an 80% mortality rate among humans — and is extremely susceptible to the disease. As a means of providing local public health authorities with an early vraming on the recurrence of yellow fever, we encourage comprehensive research programs on the biology of Howlers on the Island. Therefore, any disease- caused population changes can be recognized immediately and permit early vaccination of the susceptible human population. A. A fundamental question of tropical forests is how so many different species maintain themselves when individual densities are relatively low. For example, in an hectare of northern U.S. woods there may be 8 species of trees, whereas the same area of tropical forest may contain dver 55 species. What strategies of forestry or crop rotation should be applied to maximize prodiic- tivity and yet still preserve the long-range fertility of these two areas? An enormous amount of research has been applied to these problems in the North Temperate Zone, but in the tropics — which contain the fastest-growing segment of the human population — our knowledge of forest regeneration is still anecdotal. STRI has encouraged the research of a number of scientists examining the conditions controlling the germination, survival and recruitment of new seedlings in the forest. These scientists have taken advantage of natural light gaps in the forest, ranging in size from a single treefall, to a 1.5 hectare wind-induced blowdown on Barro Colorado Island, to huge areas of tropical forest in southeast Panama denuded by an earthquake in June 1976. 54 5. The narrowness of the Central American isthmus in Panama enables STRI scientists to monitor the entire populations of migrating broadwinged and Swainson's hawks. The breeding success of these species in North America, as well as their survival in South American wintering grounds, can be monitored by photographing and counting the individuals during their fall and spring migrations. This data is indicative of how well the breeding sites in North America are being protected and how the species is reacting to the pesticides commonly applied to northern crops, and how successfully it has over-wintered in the rapidly diminishing South American forests. 6. There have been many recent attempts to apply the mathematical models of island biogeography to the practical problems of determining the size and shape of natural forests and parks, in order to increase the numbers of species preserved and to minimize the extinction process. This is particularly criti- can in tropical reserves where many species normally exist as rare specimens or in very low densiti-es. Long-term monitoring of the population of ant birds on Barro Colorado Island has provided touch of the fundamental data on which the theory (by no means uncontroversial) of the size of tropical reserves has been developed. STRI research contributes to solution of practical problems of crop productivity, pest control, disease vectors, and susceptibility of marine organisms to pollution. The knowledge derived from our studies is often immediately relevant to other scientists asking practical questions about the management of tropical environments, but in all cases it contributes to the fundamental question of how life in the lower latitudes differs quantitatively and qualitatively from that in the higher latitudes and, most importantly, to the ultimate understanding of how events in one zone may affect the quality of life in another. 55 NUMBER OF VISITORS NUMBER OF VISITOR DRYS 56 NUMBER DF V15ITDR5 NUMBER DF VISITOR DRY5 57 SMITHSONIAN TROPICAL RESEARCH IIJSTITUTE VISITOR DATA FROM JANUARY 197k TO DECEMBER 1976 COUNTRIES REPRESENTED U.S. STATES REPRESENTED 1. Argentina 1. Alabama 2. Austria 2. Arizona 3. Australia 3. California k. Bahamas U. Colorado 5. "Belgium 5. Connecticut 6. Brazil 6. Florida 7. Canada 7. Georgia 8. China 8. Hawaii 9. Colombia 9. Idaho 10. Costa Rica 10. Illinois 11. Denmark 11. Indiana 12. El Salvador 12. Iowa 13. England 13. Kansas li;. Fiji lU. Maine 15. France 15. Maryland 16 . Germany 16. Massachuseiits 17. Ghana 17. Michigan 18. Guatemala 18. Minnesota 19. Honduras 19. Mississippi 20. India 20. Missouri 21. Israel 21. New Hampshire 22 . Italy 22. ITew Jersey New Mexico 2^. Japan Mew York . ivcnya Ilorth Carolina 26. Malaysia 26. Ohio 27. Mexico 27. Oklahoma 28. Netherlands 28, Oregon 29. New Zealand 29. Pennsylvania 30. Nicaragua 30. Rhode Island 31. Paneima 31. South Carolina 32. Paraguay 32. South Dakota 33. Peru 33. Tennessee 3^. Santo Domingo 31^. Texas 35. Sweden 35. Utah 36. Scotland 36. Vermont 37. South Africa 37. Virginia 38. Surinam 38. Washington 39. Switzerland 39. West Virginia UO. United States of America i^O. Wisconsin hi. Venazuela PLUS; District of Columbia, Puerto Rico, U.S. Virgin Islands and the Canal Zone 58 UNTVEBSITTRR RSPP^'^SKI*'|'l';i> 1. Albert -Ludwigs Universitat 5**. 2. Aatioch Graduate School of Bducatloa 55. 3. Baylor University 56. k. BeaDlngtoD College 57. 5. Botany Hood College 58. California iMtitute of Technology 59. 7. California Polytechnic Vair&raitj 60. 8. California State Univ«r«ity 61. 9. Cafflbridge Univertity 62. 10. Canal Zone College " ' " 63. 11^ Chicago -Art laatttute ■. 6k, 12. College of the Yirgla.lBlanda 65. 13. Colorado College 66. 11. Colorado State University 67. 15. Colualbia University 68 Cornell University 69. 17. Deutsher Akadiniischer Austauschdienst 70. 18. Duke University 71. 19. Diiqueanell University 72. 20. Florida State- University 73. 21. Harvard University 7^. 22. Jacksonville State University 75. 23. John Hopkins University 76. 2h. Lewis agd Clark College ' 77. 25. Massachusetts Institute or Technology 78. 26^ McMaster University 79. 2- McPherson College 80. 28. Michigan ^tate University " 8I. 29. Middle Tennessee State University 82. 30. New Mexico State University 83. 31. North Eastern University 8U. 32. Orebro University 85. 33. Oregon State University 86. 3U. Oxford University 87. 35. Pennsylvania State UoiTwrtitr 88. 36. Princeton DiEilwrsitjr 89. 37. Purdue Univ«rsitjr 90. 38. Queens University 91. 39. Rollins College 92. U-0. Royal Military Coll«g» 93. hi. San Francisco State UDlin»r»ity 9^. h2. Scripps Institutloo of OcMlMgr^lqr 95. J*3. Stanford University 96. kh. Swarthmore College 97. U5. State University of XUk 96. U6. Tabor College 99, k'^ Talladega College 100. U8. Tel Aviv University 101. U9. Tenple University 102. 50. Texas Lutheran College ' 103. 51. Universidad de Cartagena lO^-. 52. Universidad del Valle 109, 53. Universidad de Sao Paulo 1C6, 107. Universidad Nacional Autoogoa de Mexico Universidad Nacional de Costa Rica Universidad Hacional de Panama . Universidad Santa Maria la Antigua ' University of Aarhus University of Alabaoa University of Alberta University of Arizona University of British Columbia University of California, Berkeley University- of -California, Davia- - — • University of California, Los Angeles University of California, San Diego University of California, Santa Barbara University of Chicago University of Florida University of Ghana University of Glasgow University of Gothenburg University of Guelph University of Idaho University of India University of Iowa University of Kansas University of London, Kings College University of London, Queen Mary College University of Maine University of Manitoba University of Maryland University of Massachusetts University of Michigan University of Minnesota .University of North Carolina University of Oregon University of Pennsylvania University of Pudget Sound Uaiverslty of Queensland University of Rochester University of Rhode Island University of Saint Louis University of Saskatchewan University of Singapore University of South Florida University of the South Pacific University of Tennessee University of Utah University of the West Indies University of Washington University of Wisconsin Vanderbilt University Washington State University Washington University Yale University Zoologisch Laboratorium der Rijkaanlrersi' telt te Croningen 59 OTHER orga:;iz.-.t:g.:3 1. Organization for Tropical Studies 2. U.S. Army 3- U.S. Navy ^. U.S. Air Force 5- U.S. Congress 6, U.S. Embassy 7- U.S. Naval Hospitals 8. U.S. Zfaval Research Laboratory 9- American Museuji of Tiatural History 10. Balbca High School 11. Audubon Societies 12. Pag? ma Canal Cocipany 13- Corgas Memorial Laboratory Iv. Golf Coast Research Laboratory 15. Tropic Test Center 16. British Eabassy 17. United Nations 18. Boys Scouts of Aasrica 19. Zastr^n Kodak Co. 20. Paper Tech. Corp. 21. Farina 22. Boabay Natural History Society 23. Insoituto de Buceo "Tlundo Sub^arino" . 2v. Inter-Aserican Tropical Tuna Coasiission 25- Ft. Kobbe Elecentarj' School 0. Association for Militar:,' Cocptrollers e^7 . Museo I:acio-al de Panama 23. ••■'isso'iri 3?ta-ical Gardens 29- Bill Burrud Productions, Inc. 30. Instituto Inneraaericano de Ciencias Agricolas 31. Ministerio de Agricultura y Ganaderia 32 Curundu Slecientary School 33. Tri-Valley High School 3U, Peace Corp 35. Centre National de la Recherche Scientif igjie 36. Oregon Regional Primate Research Center 37. New Hanpshire .dissociation of Conservation Distric 38. Priner Ciclo A:::erica 39- Secundaria de Penonone ho. Instituto de Ensananza Superior h'L. Fairfax Legal Aid Society, Inc. k2. 'rliacii Herald l;-3. "Sea Star" Study Ship kh. Ringsdorff Carbon Corp. k'j. Tinia-Life Books '. Lincoln Park Zoo r.e-.r Tribes ydssion tS. Italian Embassy t9. The Australian Kuseun 50. r^orddeutsher Rundfunk ^5-549 0-77-5 60 51. Pathology Associates Laboratory, ?.A. 52. Hainz Steinitz Marine laoaratory 53- Colegio Javier 5^. Florida State Museum 55- Pico Rivera Kigh School 5o. Hispar.iolan Research Icstitu-e 57- Arecibo Observatory 5S. Harbor Branch Foundations, Inc. 59. Royal British Navy So. Federal Aviation Agency 6l. Asociacion Medica da Panama o2. Colegio La Salle - 63. British ?arlia:23nt 6k. I-rewhoase News Service 65. .'Austrian Embassy 00. Center for Disease Concroi 67. Institute of Marine Research 63. Institute de Cultura 69. Caliz'ornia Acadeiny of Sciences 70. r;ev Yoric Zoological Sociecy 71. Diablo Sleaentary School 72. Amy Officers V/ives Clob 73- Acade=.y of Natural Sciences 7^. Zoological Society of Cincinnati _ 75- 27e-.v Yor'^ Botanical Gardens 76. Icstit'jwO de Botanica de Sao Paolo 77. Museo ie Historia Natural del Peru 73. Ins-ituzo de Ciencias liaturales de. Colombia 79- i--'iseo riacional de Pan"",? 80. Balboa Elecentary School 81. Wolgang Bayer Productions, Inc. 82. • Kilver-one Wildlife Park 83. Royal Ontario Museum 8^. Ramsay Wright Zoo 85. Federal Highway AdEdnistration 86. Batelle Memorial Institute 87. Argonne Natural Laboratory 83. Austrian Consulate 89. Argentine Air Force 90. Nicaraguan Embassy 91. Ministerio de Desarollo Agropecuario 92. Monks Wood Experimental Station 61 FrLLOWSnirS AT 1970 - 1977 Post- doctoral Fellows Degree Conferring Institution Abele, Lawrence Andrews, Madaleine Breymeyer, Alicja Campanella, Paul Cooke, Richard Cubit, John Diener, Douglas Glaaz, William Gliwicz, Z, Graham, Jeffrey Healey, Ian Hespeoheide, Henry Hladik, Annette Janos, David Karr, James Kramer, Donald Lubin, Yael May, Michael Meyer, David Morton, Eugene Ogden, John Ranere, Anthony Ritte, U. Schemeske, Douglas Smith, James N.M. Todd, Eric Warner, Robert Wells, Kentwood Windsor, Donald University of Miami University of Kansas Polish Academy of Sciences Syracuse University University of London University of Oregon University of California, San Die University of California, Berkel; Warsaw University Scripps In3T:itution of Cceanograj University of London University ■ of Pennsylvania University of Paris University of Michigan University of Illinois University of British Columbia The University of Florida University of Florida Yale University Yale University Stanford University University of California, Davis University of Michigan University of Illinois Oxford University^ University of California, Santa' .• Scripps Institution of Oceanogra]( Cornell University j Cornell University Pre-doctoral Fellows Augspurger, Carol Fischer, Eric Foster, Robin Gyllenhaal, Chaurlotte Heck, Kenneth Hoffman, Stephen Kiester, A. Ross Kropach, Chaim Lessios, Haris HcCosker, John Pickering, John Porter, James Pratt, Thane University of Michigan University of California, San Di^ Duke University University of Chicago ' Florida State University University of California, Santa l" Harvard University City Uni^/ersity tf New York Yale University Scripps Institution of Oceanograi Harvard University Yale University Rutgers University 62 Parairez. v;illiam Smith, V/ayr.e Strauch, Joseph Tanaenbaua, Bernice Toft, Catharine Young, Orrey Zaret, Thonas University of 'Kansac State Univ. of M.Y. at Stony Bro University of Michisan Cornell University Princeton University University of Maryland Yale University 63 w H a H Z > H Q w 9 P id ii Q. O u H 01 O it CO O ~( e o 0) q c u 0) o to b H O >» H o. O C3 C u o .t; {-I "o c . « ■ £ "S ii r « «J c tic r o -t; o •S © « c a» B o 2, [5 « « C ■ O 3 a, CT O C ^ ^ :S o 60 .o ^ C r; *» a) u «e - •5' S H 5 gr ^ ©^ C _ o o 5 'S !3 o o ^ S © ? o « 3 * ■> £ 5 3 ID -J- - a-s » *5 3 O « c ^ •H -3 a c o J-1 >> 3 J r: U O — -H (=: a z o o o u :3 -rl 2 > C N a c 64 H W i >, oi •H CO u a. « CO a 3 > u u 0) 9) U <: I ») C -u ^ O 00 C C « •H .-I 5 w o o 3 CO 0) a c 3 a i-i • O -r-l RJ • o to O M c kJ Ml) CM u o 0) GJ o e 65 9 9 2 H D H D Q S < o W g D O 1 2r o e 3 hi U O o u 3 « 1 Colo e « B o B hi C O hi 0» (9 « n u •H or e »J t-) o iw Co B O e o o c hi o hi 4-1 •H « « 4J n i-l 9 CO 9 ^ e hi o O. •H o O O hi CI o Oi JJ B 0) B 0) 1-t O Q •H >» iH 4J hi « o T3 «3 a u C t-l c « nd o o g c c 9 9 « § t-l O rH O hi B hi « W M o £ 9 ^ g c o O M K 4^ 06 K a H M 2 CO 1 c hi U CO e o N •o h> •H a a •J w w t-t « hi IS o -o • Tl 1^ ch 00 e o a 2 hi j= £ u a hi o o • e .H 2 « a u tw E o •H o ^ Ch 0) o a **■ a u hi « •> c H ^ hi 10 a eo 4J a c u eg a o II ca «3 e Ss W 0) •H B M S •« E a O -H u % >-< •H to M a WO o C a O C •H hi ta a •o o o ^ u n jC 0) a M M P4 0) o ta •J f-i b U U u td eC C fcJ B hi -o «-> c a CSX hi •W 4J O 0) >» a •J E -o .'^^ 3 U o ^ U jC CO •O JO o c 1 C OD-H O C3 M 25 Q 00 r-l hi eo « c o . o a U O -r^ -3 ^ >• <^ 5 r-l c r-l >, 0> < • 01 C (O 5 . 9 66 ■ < ii iJ OS C H C H U (/} e ^ c a o o 4J eg QO E T3 a. o w o O. *J O t-l O 3 CiO N O -M O 3 65 03 <5 COO O -H •U O 10 3 M E ^ *J a) . M z to u 60 3 < O 3 C Ss A! q E c e o o u u a o c S CO c O cQ o (0 Q) a •o C3 Q C >t g C Q 0) 0) O 60 o •H •> O 4J 13 u u r-t rH 0) -H 60 Z 60 60 oa o 00 o 60 O JS O c c c U f-i U r-l j= 4J O •H • •H U 1-1 ;S c U t-t u u o c (0 -H C3 o 0) CJ a> V O CJ c jc e ^ s j: ca J3 C J3 C ^ c O 3 o u o c c o c •r-l 4J •w •H M to OS < ci < c: < < z to (Si 67 Mr. Metcalfe. Do any other members of the delegation wish to make a statement at this point? Dr. Rand. No. Mr. Challinor. No. Mr. Jameson. No. Mr. Metcalfe. Dr. Rubinoff, thanks very much for that very fme statement. I did note that you were asking the Committee to increase its limit on authorization for appropriation from $600,000 to $750,000. We will review your request before a final decision is made. On page 1 of your statement you stated the Canal Zone Biological Area is an integral part of the Smithsonian Institution's Tropical Research Institute. Do you therefore think that the budget of the Biological Area should continue to be included in the Research Institute's budget? Do you think they should both be in one budget? Dr. Rubinoff. Yes, sir. I think the interaction between the two parts of the Smithsonian Institution's Tropical Research Institute are very close. The work that is going on on the mainland is frequently carried over to the Island. Comparative studies are being done. The scientists might spend two days on the Island and three or four days a week working on the mainland on a similar project. The Island represents one kind of habitat and many studies require comparative work, perhaps at a higher altitude, work on the mainland, or some places closeer to the shore, so I think it should be included. Mr. Metcalfe. Our jurisdiction is not the jurisdiction of the Appropriation Committee, so as we take up the authorization limit that has to be considered. It is my understanding that part of the expenses of operating the Canal Zone Biological Area are recovered by fees from those who use the land. What percentage of the operating costs of the Canal Zone Biologi- cal Area are recovered in user fees? Dr. Rubinoff. In this fiscal year, Mr. Chairman, the operating expenses of the Barro Colorado Island are $305,000; capital projects which we have planned or are under construction are $21,000 for a total of $326,000 in direct operating costs this year, of which we expect about $50,000 will be recovered in the way of fees from visiting scientists. Mr. Metcalfe. Thank you. The Section of the United States Code which governs the Canal Zone Biological Area is Section 79 of Title 20. Do you think that the other provisions of Section 79 ought to be changed other than the one figure which we have proposed to change? Dr. Rubinoff. I believe that at this point we are operating very efficiently within the other provisions of Section 79. Mr. Metcalfe. I refer you to page 7 of your statement. You say that the General Accounting Office believes that indirect costs associated with the Biological Area ought to be included under the limitation of Section 79(e). 68 Do you agree with this opinion of the General Accounting Office? Dr. RuBiNOFF. I think that indirect costs can be assessed. However, as I said earlier, the interaction between the research going on in the mainland or other areas of the New World and Old World tropics are so close that it is a difficult assessment and some formula will have to be used. For instance, the amount of time I think about the administra- tion of Barro Colorado Island versus the time I spend worrying about the rest of the STRI would be difficult to assess accurately. Mr. Metcalfe. You stated capital costs should be included in the funds under Section 79(e). Should capital funds be included in the limits under this bill? Dr. RuBiNOFF. I think so, sir. Mr. Metcalfe. In referring to page 7 of your statement, you indicated there should be no particular problems for the Biological Area to stay intact under the new treaty arrangement. Are you satisfied with your relationship with the government of Panama? And do you know of any reason why they would want to change the status of the Island? I think this goes pretty much to the heart of what Congressman Snyder has said, and he will have his own time, but you might keep his statement in mind as you prepare to answer that question. Dr. RuBiNOFF. We enjoy a very good relationship with the Repub- lic of Panama; with a number of ministries, with the university; and with various other agencies. We have recently concluded a contract with the Ministry of Health, which authorizes our operations throughout the Isthmus of Panama. We have cooperated with it and with United States based institu- tions located in the Panama Canal on a number of environmental projects in the Republic. I do not anticipate that there will be any change in our oper- ations on the Isthmus if the status of the Canal Zone changes. Concerning the Island itself, I might point out that there was a treaty for international, inter-American cooperation (the 1940 Con- vention for Nature Protection and Wildlife Preservation in the Western Hemisphere), which was signed by the United States and by now has been signed by most of the Republics in the New World, allowing them to cooperate on conservation matters and I think the status of Barro Colorado would easily fall under that treaty which has been signed by the Republic of Panama. We are covered on a number of grounds, both formally and informally, and I am reasonably certain that the future research center of Barro Colorado would be preserved. Mr. Metcalfe. Both the Biological Area and the Research Insti- tute located in the Canal Zone. This being the case, to what extent are your costs determined by the prices for goods and services by the Panama Canal organization? Dr. Rubinoff. We purchase most of our commodities, expendable construction materials and things of that nature, from the Panama Canal organization, but not all. When items are in short supply or 69 are available locally at a lower price, we purchase them on the local economy. The exact percentage of these two I would have to provide for the record. I don't have them. Mr. Metcalfe. You will submit that information for the record. Thank you. [Information about purchases follows:] g cr W vO o o in in in CO i-H o o (N3 vO p z ^ § P O o o o o ^ o I— I •i-i 0) CQ •H I— « P- 5 ^ ^ ^ ro -H 00 in in in o o 0. u t— I P. en CO O cj i-t o o . ^ i< r-l »4 < ^. J3 © J3 fl O O ♦* E 4^ d M © VI O O -« S O ©HO VI A VI -P CO O OD w O d w+J ■O > VI (D © • O -H O d O > CD 4-> ^ O O •H © C £X 09 ^ © O 3 a< *» e; »H o TJ o o © 3 E O -H r-l © M O d d ♦J d >4 03 M O -H CO O O O ▼^ "O •o © X ^ ft w a C P +J fH O "H 3d ^ O fH V( > T3 3 -H O 0) ^ C &VI -H d fH t< d "H ca do. - O -O •p - cn © © © o /-N n o D. c N •P W O O to O 'H ^ U U N (4 O 3 3 © © X! -O +J O W . . b CD VI d C © O d C -P O d > E »^ d O J3 U VI d O -H © -o o •H .H fci £ r-l © >» bO d O © O M O (i t2 d Ti J3 tH O ©©©<-( O o -a -P £ -H -H *4 © d VI O 4-> J3 CQ O O O 3 » W 5 •o ^ ^ 2 H « "2 -5 < Q "ig « w w (j; u ^ S OS t < U «) 2.03 u w o: u u« o oc o >n J 2 2 1 £ o o o 2 s s o " «» o w o o o 85B o +* i > © & Qt rH W ^ d > ^© o >» < S Si O CO o o o ^ (MOO — • O < u 13 2. CO J S 5, <; u <« o o o 86 2 s U w ofi u 2 f- 2 o U c w u « ^ o o o 2 ; -8 O »- 2 5 - < V u ^ '^'Z ■■i< U CO OS U J o < U OS T3 W C Q « U « ^ c 2 2 o o 5 31 1 y /> J- 87 s < 5 J * S ^ .2 »* !^ 05 r •< u w tx; u ^ 8 " W c w Q "> • W « u< -c ^1 SI o o 2 o o — o o o r- o t C« - 05 'C -2 •< Q «N U w 05 u o o o 88 I I X c •o s ■, •* c g < 2 OS <: u !; 2.P3 u w p; o k4 < o "< o o o ^ o .2 2 X c — U 4>fM| OS -3 «< Q -IS « N U «) 05 U 2 2 -5£ o o o 2 89 3. (a) Does either the SraithQonian Tropical Research Institute or the Canal Zone Biological Area borrow any funds from any sources for capital or operating expenses? (b) If there is any borrowing, list any loans made to either^'the entitles over the last five years, and delineate the expen'dltures made by each entity sliowing the loan duration, interest rates, and the Interest paid to date on any loans. (c) If the expenditures were not made from loans, why did you prorate over their useful life the costs of telephone Installation and tramway renovation instead of listing their full costs as expenditures in the year(s) these projects were accomplished? Neither the Smithsonian Tropical Research Institute nor the Canal Zone Biological Area borrows funds for any purpose. • An interim internal planning document prorated capital expenses involved in the reconstruction of the tramways and the installation of the telephone on Barro Colorado Island in order to obtain a reasonable estimate of depreciation and a projection of required replacement. The telephone installation was originally to be accomplished by the Panama Canal Company in its role as supplier of public utilities in the Canal Zone. Had this been done the costs would have been amoritized to STRI over a number of years. In that very restricted sense, STRI would have received a loan. However, because the Canal Company refused to afford this project sufficient priority to allow capital funds for the purchase and installation of the necessary equipment Smithsonian funds were used. The telephone was charged to the year the contract to the Canal Company was issued (FY V6), as was the fabrication of the rail support and procurement of the winch for the tramway. Installation of the winch and control mechanisms were completed in FY 77 and charged to the current appropriation. 95-549 - 77 -7 90 4. Regulations What are tbe rules and regulations which govern the Smithsonian Tropical Research Institute and the Canal Zone Biological Area? Kow are the rules and regulations which govern the two entities the same? How are they different? Who is the issuing authority for the rules and regrulations which govern each entity? The Smithsonian Tropical Research Institute was established in 1966 by the Board of Regents of the Smithsonian Institution. It is governed by the general provisions of the basic Smithsonian statutes, as well as memoranda and regulations of the Smithsonian Institution issued under 20 USC 41 et seq . Administration of the Canal Zone Biological Area (Barro Colorado Island), which is an integral part of STRI, is subject to the same statutes and to the provisions of 20 USC 79a-e as well. Both entities are further subject to Federal law governing the uses of appropriated funds, the civil service as it applies to the Canal Zone, and procurement among others; to the Canal Zone Code and related laws enacted by Congress; and to executive orders issued by the Secretary of the Army and the Governor of the Canal Zone. 91 5. User Fees Over the last five fiscal years, what porcentaRe of the operating costs of the Canal Zone Biological Area have been recovered in user fees? What percentage of the total costa have been recovered in user fees? V/hat formula is used to determine the fees that should be assessed? Barro Colorado Island fees are recommended by the Director of the Smithsonian Tropical Research Institute and approved by the Treasurer of the Smithsonian Institution. No explicit formula is used to calculate fees, but existing guidelines proWde that user fees should (1) cover those costs of BCI which increase as use increases and (2) cover some small fraction of fixed costs. In setting fees, fees charged at other field laboratories are considered. Student fees are related to amounts granted as stipends through fellowships from major U. S. universities and the National Science Foundation. 6. Proration of Grants Are any of the grants received by the Smithsonian Tropical Research Institute partially or wholly assigned to the costs of the Canal Zone Biological Area, either pursuant to 20 U.S.C. 79d or anpther section of the statutes or regulation? 0. 92 7. Capital Project Priority The Smithsonian Tropical Research Institute's submission to the Panama Canal Subcommittee on April 28, 1976, Indicates a need for eight repair and building programs for the Biological Area In the next decade. Prioritize these programs and characterize the Importance of these, and indicate the amount needed for each. PRIORITY REPAIR AND RENOVATION PROGRAMS 1979: Replacement of dormitories originally constructed in 1924 $125, 000 The building is heavily infested with termites; its wiring is obsolete; and room arrangements and accommodations are inadequate for scientists on long-term research projects. 1980: Replacment of dining hall a n d kitchen facilities with more modern sanitary facilities $169, 500 Present dining facilities are part of the dormitory building constructed in 1924. Because many scientists work 6n nocturnal organisms, it is important that sleeping quarters are separated from noise-producing daytime activities associated with the kitchen and dining areas. The structure is wooden, and difficult to maintain at modern sanitary standards. The kitchen is in a small wooden building adjacent to the dining room-dormitory. It is difficult to clean, contains inadequate storage, and is too small to accommodate modern food preparation and dishwashing machinery. 1981: Replacement of current septic- sewage system with modern, nour- polluting sanitary treatment facility $50, 000 A new facility would tie together the buildings into a single sanitary system under one control. 93 Reconstruction of the ground floor of laboratory building. $35, 000 The laboratory building was found to be dangerously termite infested in 1976 and on an emergency basis the upper story of this building was reconstructed, allowing a more efficient apportionment of space and an energy saving central air- conditioning system was installed. The ground floor reconstruction would permit further economies of space, cooling, and dehumidification. Construction of new long-term staff scientist residence. $35, 000 Staff and post-doctoral student research interests vary from year to year, but the observable trend is toward longer term studies which frequently invol\f- comparison of fluct'iations in the environment between dry and wet seasons and between successive years. Scientists, particularly those with families, require more space and privacy than can reasonably be accom- modated under dormitory arrangements. 1982: Reconstruction of animal holding facility $35, 000 The present facility provides adequate space for keeping animals necessary to research in captivity and providing for their food and health care. However, the wood and screen structure is suffering the ravages of termites^ carpenter ants, and dry rot, and should be replaced with a concrete structure. Enlarging plant growth facility $20, 000 Plant ecology is an essential program designed to learn how the forest regenerates itself. A more substantial permanent facility is required in the near future $20, 000 Towers and cros-swalks '. » . . $25, 000 The processes and activities ot the forest canopy are the least understood aspects of the ecology of tropical forests because no safe and simple method of sampling and observing has been devised. A series of towers and crosswalks between them is proposed for sampling and observation of a reasonable cross - section of the forest at 100-150 feet above ground. 94 8. Increase In Visitors Data submitted by STRI In 1975 and 1976 to the Panama Canal Subcommittee indicate a great Increase in 1975 In the number of visitors to the Biological Area. Why did this great Increase in the number of visitors occur? The large increase in visitors to Barro Colorado Island during 1975 can be attributed to several causes. The first of these was a highly successful series of weekly guided tours. This was an experiment in public education aimed at the interested layman, both American and Panamanian. Given by a bilingual guide in English and Spanish, each tour included a hike in the 'orest a tour of the facility; a lecture on the environment, its plants and animais; and an explanation of the role of the Smithsonian Tropical Research Institute in studying them. Though very popular, the tours have been curtailed drastically in 1976 because of financial constraints and because of increasing scientific use of the island. The increasing scientific use of the island is another major reason for growth in the number of visitors to Barro Colorado Island in 1975. Subtracting visitors, numbering more than two hundred, who came on tours in 1975, the number of visitors to BCI has shown a smooth and regular increase over the last four years because more scientists and students are performing research there. The reasons for this are centered mainly on the growing interest in the United States and some of its universities in the agriculture, climatology, ecology, public health, and conservation of tropical parts of the world, and an increasing need to study this region. With rising costs throughout the world and decreasing amounts of money available for research, the opportunities for doing research on BCI have become more attractive. As very large grants, which formerly allowed an investigator to build an individual field station, are becomming fewer, more investigators are turning to established stations such as BCI where facilities are already available and are less expensive on a per capita basis because of shared costs. In addition, several tropical field stations such ?F,Bimini, have been forced to close or to drastically reduce programs, as are the cases of Ots in Costa Rica and Simla in Trinidad, primarily because of rising cost factors. Thus, a decreasing number of alternative facilities has also increased the number of people wanting to use Barro Colorado Island. 95 9, Authorization for Bloloftlcal Area How can It be assured that the authorization limit for the Cajial Zone Biolo?;ical Area is not being exceeded when the appropriations for the EtoloRical Area are indistinguishable from appropriations for the Smithsonian Tropical Research Institute? The Smithsonian Tropical Research Institute budgets a specific amount for Canal Zone Biological Area expenses each year within the limits authorized by Congress. The accounting system of STRI and the supervision of this system by both the Smithsonian Accounting Division and the Smithsonian Office of Audits in Washington, D. C. , assures adherence to the authorized limits. 10, Treaty Negotiations Considering the contract signed between the Institute and "the Government of Panama, would a change in the jurisdiction to which the Canal Zone Biological Area is subject alter the basic benefits, contributions, or responsibilities of the Area? The possible effects of a change in jurisdiction on the Canal Zone Biological Area have been discussed with the U. S. Department of Stale. Its staff believe s that under an international agreement, which will be part of a ncv/ treaty, the reserve and the research status of Barro Colorado Island will be protected. Discussions with Panamanian Government officials indicate their full appreciation of the importance of Barro Colorado Island as an international conservation and scientific resource. In addition, we believe two existing agreements would further insure the continued operation of the Smithsonian Tropical Research Institute and its Barro Colorado Island facility should jurisdictional changes occur. The first is an international convention, signed by the United States in 1940 and ratified by Panama in 1972 which provides for cooperation between the American states for purposes of pre- servation of flora and fauna and natural areas. The stecond agreement is a contract signed by STRI in 1977 with the Panamanian Ministry of Health which authorizes scientific operations throughout the Isthmus. Jurisdictional changes may effect operations such as procurement sources and the compensation scale of employees, but would not materially effect the quality of the scientific research or the benefits of that research. 96 Mr. Metcalfe. To our witnesses I would like to express, on behalf of the Subcommittee, our deep appreciation for your presentation and for your meeting here with us, and for being able to give us some answers to the questions that we have. If there is no further testimony, the meeting of the Subcommittee will stand adjourned, subject to the all of the Chair. Thank you very much. [Whereupon, at 3:10 p.m., the meeting of the Subcommittee was adjourned, subject to the call of the Chair.] \ PROBLEMS OF CANAL ZONE RESIDENTS AND EMPLOYEES TUESDAY, APRIL 12, 1977 House of Representatives, Committee on Merchant Marine and Fisheries, Subcommittee on the Panama Canal, Balboa, Canal Zone The subcommittee met at 9:00 a.m. in the Board Room of the Administration Building, Balboa Heights, Canal Zone, Hon. Ralph Metcalfe (chairman of the subcommittee) presiding. Mr. Metcalfe. Good morning. We have here this morning Con- gressman Leo Zeferetti, who is a Member of the Panama Canal Subcommittee. On my immediate right is Congressman Elwood Hillis, a Member of the Armed Services Committee. Then we have Minority Staff Member Mr. Nick Nonnenmacher and we also have with us Mr. Benard Tannenbaum, a consultant to the Committee on Merchant Marine and Fisheries, and we are extremely happy to have him. We also have Mr. Keith Guthrie of the State Depart- ment, who did an excellent job yesterday of briefing us on the plane even though hindered by the noise of the airplane engines. His briefing was excellent. Another gentleman here this morning is Mr. Coleman Conroy, my legislative assistant. His duties go far beyond those of a normal legislative assistant. He is active and is often called into consultation whenever Mr. Terry Modglin, whom I am to introduce now, is taken up with an issue and well-taken up. I thought it incumbent to bring Mr. Conroy down to help in the assistance. The charming lady to his left is Mrs. Carolyn Robinson, who is a staff member. Governor Parfitt, Ladies and Gentlemen, we are pleased to be in the Canal Zone once again. We are pleased this morning to invite the counsel of a dynamic Governor and a group of managers who have kept the Panama Canal running in an admirably efficient way. There is much to be discussed today. The last occasion on which the subcommittee formally heard Governor Parfitt was April of last year. The last general oversight hearings of the subcommittee were two years ago. The last subcommittee hearings in the Canal Zone were three years ago. While we have not had the Governor as a witness in nearly a year, we have exchanged much correspondence on a variety of subjects. (97) 98 I might add parenthetically that the Governor has always re- sponded immediately to our requests. Congress does have an important role as the legislature for the Canal Zone, and we are here to see what laws are needed. We are here to see if the present law is being administered in accordance with the intentions that preceded it. We are here to determine what the best framework for operating the Canal and Canal Zone ought to be. Having said this, I would like to give my two distinguished colleagues an opportunity to make some remarks. We have a distinguished member of the subcommittee, as I indicated before, Representative Leo Zeferetti, to my left. We are especially pleased that Congressman Elwood Hillis of Indiana, a member of the very important Armed Services Committee, has been able to make this visit with us. I am sure that he will have a number of very cogent questions about the military side of the Canal. Gentlemen, do either of you wish to make a remark? Mr. Zeferetti? Mr. Zeferetti. Thank you, Mr. Chairman. As a new member of the subcommittee, I welcome the oportunity to be able to sit in at these hearings and obtain firsthand informa- tion. We are here to learn. Governor, I want to thank you for being most gracious and most hospitable to us last evening and I welcome the opportunity to hear your testimony. Thank you, Mr. Chairman. Mr. Metcalfe. He does that with such great ease. Congressman Hillis. Mr. Hillis. Thank you, Mr. Chairman, I, too, am very happy to be in the Canal Zone. I am here as kind of an observer, and I am here to have the opportunity to learn what part the Canal plays in our overall national security picture. I, too, want to thank you for a very nice evening. Mr. Metcalfe. At this point I ask unanimous consent that Congressman Elwood Hillis be allowed to sit with the subcommittee and that he be given all procedural prerogatives due subcommittee members. Without objection it will be so ordered. Governor Parfitt, we are now anxiously awaiting your testimony. STATEMENT OF HAROLD R. PARFITT, GOVERNOR OF THE CANAL ZONE, AND PRESIDENT OF THE PANAMA CANAL COMPANY Governor Parfitt. Mr. Chairman and members of the committee, I extend to you a warm welcome to the Canal Zone. I am certainly pleased to be of assistance and trust that the information you will gather during the course of these hearings will provide a useful perspective of the Canal enterprise as a whole and in addition afford you some insight into special problems we face in our day-to- day operations. Your interest in, your guidance of, and your support for the Panama Canal and its employees are all most welcome in helping to combat the morale problems which we now face. The tremendous 99 uncertainties arising from treaty negotiations and the cumulative effect of changes over the past two years in policies affecting personnel benefits and living and working conditions have had an adverse effect on morale. It is not possible to pinpoint specific occurrences wherein this weakening of morale has thus far had an effect on operations, but it is generally obvious that the traditional pride of the Canal employee in his work has been adversely af- fected. Inevitably, if not checked, this will erode productivity. The most evident expression of low morale is the significant increase in turnover of U.S. citizen employees which occurred during calendar year 1976. Resignations by U.S. citizen employees during 1976 totalled 290 out of an average employment figure of 3514, or 8.25 percent. Although the number involved is not alarm- ing, the trend is of considerable concern. The Panama Canal workforce has always been characterized by a high degree of stabil- ity, but in 1976 the resignation rate was 30 percent over the average for the previous 9 years and 57 percent over the average for the previous 3 years. Many of the vacancies resulting from increased U.S. citizen turnover can readily be filled from the local labor market. Aside from the increased cost due to replacement processing and break-in time for new employees, and the reduced efficiency of operating teams, such as at the locks, this turnover is of limited significance for the agency. The hard-to-fill categories do concern us, however. These include our Canal pilots, towboat and dredge masters and engineers, nurses, medical officers, machinists and electricians, and a few others. We are therefore carrying on an active U.S. recruitment program for those positions which cannot be filled locally. Obviously, substantially higher costs do result from this method of filling our vacancies. Recruitment problems have stemmed from publicity in the U.S. concerning the treaty negotiations with the Republic of Panama. Prospective employees are wary in seeking employment with the Panama Canal when doubt exists as to the future security and tenure of the positions and the conditions which might prevail under a new treaty. Nevertheless, at the present time, we continue to be able to recruit essential skills from the United States. Let me emphasize at this point that the company's position is that we should continue to operate on a sound, businesslike basis as an ongoing enterprise, without attempting to anticipate the many possibilities that might be considered in the treaty negotiations. In that respect we are continuing with our ongoing capital programs, and contemplate an increased level of expenditures for capital replacements and improvements over the next 5 years. For exam- ple, an important capital project presently underway is the widen- ing and straightening of portions of the navigational channel through Gatun Lake. When completed the project will provide greater safety for the navigation of the larger ships that we are seeing in ever-increasing numbers. To return to the matter of morale, the uncertainties inherent in the treaty negotiations have been exacerbated by several factors: 100 Press releases in Panamanian newspapers presenting as fact their versions of the content of treaty talks and attacking the Canal Zone and Canal employees; The January 9, 1977, incursions into the Canal Zone; The Panama National Guard detention for several hours without cause of one of our most active labor representatives, Officer Wil- liam Drummond, President of the Police Union, and an outspoken opponent of the treaty; And a series of bombings in the Canal Zone last fall, one of which involved the automobile of Officer Drummond. Such incidents tend to alienate employees, harden their resent- ment, and intensify their fear of post treaty conditions when they might no longer have the protection and guarantees presently enjoyed under U.S. jurisdiction in the Canal Zone. I have long advocated release of information about the treaty talks and last month I was successful in obtaining consent of the U.S. treaty negotiators and the Secretary of the Army to release to our employees a 15-point paper outlining assurances concerning employee rights that constitute the minimum position of the United States with respect to these issues. Employee response to the announcement has been cautious and reserved to date. They are generally appreciative for having been authoritatively informed; however, there is a general feeling that the assurances are inad- equate and leave many questions unanswered. They are hopeful that this marks the beginning of a more fruitful exchange between employees and U.S. negotiators. [The material referred to follows:] 101 ASSURANCES FOR PRESENT EMPLOYEES OF THE PANAMA CANAL COMPANY/ CANAL ZONE GOVERNMENT UNDER A NEW PANAMA CANAL TREATY (Given to Canal Employees by Canal Zone Governor Parfitt on March 15,1977' The following list of assurances for present United States citizen and non-United States citizen employees of the Panama Canal Company/ Canal Zone Government are derived from the United States position. They represent those assurances on fundamental items of particular interest to Canal employees which would, as a minimum, be provided in the context of any new treaty relationship. Obviously, all treaty provisions are subject to negotiation, the ratification process, and such Congressional implementing legislation as may be appropriate. • No formal^, comprehensive agreement has been reached between the United States Government and the Republic of Panama regarding this issue or any other. These assurances are not intended to be final or all-inclusive. Other areas of concern are continuing to be examined. These assurances should, however, provide employees with a general under- standing of the minimum level of benefits and protections being sought . 1. Schooling and medical care provided by the United States Government will continue to be available for United States citizen employees and their dependents . 2. United States citizen employees will continue to be provided with adequate housing at a reasonable cost. Resi- dential areas will be managed in such a manner as to maintain a mix of United States and Panamanian residents. 102 3. United States citizen employees and their dependents will continue to enjoy duty-free import and purchasing privileges conceiming items for private use. They will also be authorized use of military service facilities. A. United States citizen employees and their dependents will be exempted from Panamanian tax on any income derived from The Canal operation or other United States Government agencies, and sources outside the Republic of Panama. 5. In connection with offenses arising from acts or omissions punishable under the Laws of the Republic of Panama, United States citizen employees and their dependents will be entitled to specific procedural guarantees , such as prompt and speedy trial, specific charges, cross-examination of witnesses and legal representation of choice. 6. United States citizen employees and dependents who may be considered to be dual nationals will have the same status under the new treaty as those of exclusive United States citizenship . 7. Non-United States citizen employees automatically will be covered under the Panama Social Security System, except that those with five or more years of United States Government service as of the effective date of the new treaty will have the option to retain U. S, Civil Service retirement coverage in lieu of transfer to Panama Social Security coverage. 8. Panamanian citizens will be employed in increasing numbers at all levels of the management and operation of the Canal. 103 9. Increased Panamanian employment in the operation of the Canal will not be used to displace current United States citizen Canal employees. 10. All eligible employees are guaranteed by current regulation, reduction-in-force and reassignment right, transfer or function rights, and discontinued service retirement following involuntary separation. In addition, the Civil Service Commission will be requested to grant approval of and/ or waivers for "early optional retirement" or liberalized severence pay coverage for employees of Canal enterprise activities which are scheduled for elimination, reduction or transfer. Employees whose working conditions are so adversely affected by the treaty that special consideration is appropriate may also be included in this conmission request. 11. Civil Service Commission approval will be sought to provide any present United States citizen employee requesting such assistance with priority placement consideration for appropriate vacancies in federal government agencies. 12. To the extent consistent with sound management, the terms and conditions for the employment of non-United States citizen personnel will, as a matter of policy, conform with the general principles contained in the labor laws of the Republic of Panama. 13. The Government of the United States will ask that special placement assistance be offered by the Republic of Panama to any non-United States citizen employee who may be displaced by reason of the treaty. '' 104 lA. The Canal management will conduct Its relations with recognized employee unions representing Canal employees in accordance with Executive Order 11491, as amended, and/or other mutually acceptable form of collective bargaining. 15. Recommendations, if appropriate, will be made to the Office of Management and Budget for legislative action found necessary to prevent an erosion of the general level of employee benefits and conditions of employment under any new treaty. Governor Parfitt. An additional step that I feel has had a calming effect is the clarification of the matter of procedures for U.S. citizen employees desiring to transfer to Civil Service positions in the United States. In general, movement of U.S. citizen employ- ees between the Canal Zone Merit System and the competitive Civil Service is accomplished in the same manner as transfers between two positions in the Civil Service. Considerable publicity has been given to this information and two Company personnel specialists have been designated to handle inquiries about transfers and re- lated personnel matters such as transportation. Furthermore, the company has subscribed to the Federal Research Service Report, a private publication listing vacancies in federal agencies nationwide, and this information is posted for public use. From management's point of view, we do not want to lose any of our valuable employees, and these measures are designed not to encourage transfers but to give U.S. citizen employees the sense that we are interested in their welfare and that they are part of the overall Federal establishment and need not move rashly. Another underlying cause for increased turnover among U.S. citizen employees is the perception that there is an ongoing whit- tling away of their benefits and living and working conditions. Although in these days such a perception might be universal within the Federal service, for the Panama Canal employee it has a special significance. The development of the Canal's highly stable workforce was a direct result of the stability of benefits and living conditions, including housing in Company towns and shopping in Company stores. The influence of the Company in the lives of its employees is all-pervasive. For that reason, any change in benefits or living conditions is perceived as a change in employment condi- tions, a breach by the company of the incentive conditions that originally induced the employee to accept stabilized employment with the company. There have been changes, some as the result of economic pres- sures, and others to bring about greater equality of opportunity and treatment for our non-U. S. citizen employees. Many of the changes, 105 as you know, were made following the recommendations contained in the GAO study in 1975. I would like to give you an update on some of the more significant changes that have taken place. Consolidation of Housing In February, 1976, a change was made to the housing regulations to consolidate housing formerly assigned separately to U.S. citizens and non-U. S. citizens. As a result of this change, non-U. S. citizens at or above the NM-7 level already assigned family housing in the Canal Zone can compete with U.S. citizen employees on an equal basis for vacancies in U.S. community housing. There are more than 190 non-U. S. citizens living in the Canal Zone who are at or above the NM-7 grade level. Of these, 62, primarily policemen and physicians, were already living in U.S. communities. An additional six such special position housing assignments have since been made, and 13 non-U. S. citizens have made the change to U.S. communities under the new regulations, bringing to 81 the total number of non- U.S. citizens residing in U.S. community housing. Also, as part of the change, U.S. citizen employees who are below the NM-7 housing eligibility grade cutoff were made eligible for housing in the former Latin American communities, and 87 of them have taken advantage of this opportunity and moved from Panama into these communi- ties. Additionally, 60 U.S. military families were provided such housing on a space available basis. I am pleased to report that the consolidation of the housing to date has gone smoothly. Consolidation of Schools A year ago last month we began Phase I of the consolidation of students from our Latin American schools into our U.S. schools. 119 pupils in kindergarten through fourth grade were given special English language training during the late Spring and entered U.S. schools in August with the beginning of the regular school year. In addition, 41 students from the phased-out grades took advantage of the option to attend schools in the Republic of Panama, with tuition and transportation costs borne by the Canal Zone Government. Reports indicate that Phase I has gone well. Phase II, involving 183 students going into grades 6 through 8 has just begun and 169 of these students are undergoing the special training to prepare them for entry into U.S. schools in August. Another 14 students have opted for schools in the Republic of Panama. The third phase will involve approximately 300 students going into grades 10 through 12, who will be offered three choices: they may transfer to U.S. schools, opt for schooling in Panama, or, if enough students so desire, may continue their education in their present school until the last students graduate in December, 1980. There has been very little difficulty with the consolidation of the non-U. S. students into the schools. There have been, however, strong objections raised by U.S. citizens against having their chil- dren taught by non-U. S. citizen teachers. Thus, placement of the teachers from the Latin American schools as those schools are phased out, is very sensitive and requires special care and attention. 95-549 - 77 -8 106 Security Positions Another change that was made recently was the establishment of new criteria for the designation of security positions. Under legisla- tion implementing the 1955 treaty, there is to be equal employment opportunity for U.S. and non-U. S. citizens, with the exception of positions which require U.S. citizens for security reasons. Under the new criteria, which were adopted on July 4, 1976, the number of security positions was reduced from 1095 to 580. Additionally, in February of this year, the Fire Division, after consultation with the involved unions, acted to remove the security designation from all fire sergeant positions. Previously seven had been designatd as security positions. Equal Employment Opportunity In the area of human rights, our equal Employment Opportunity program has been very active and may experience a substantial increase in workload. The General Counsel of the Civil Service 1 Commission has recently ruled that non-U. S. citizens employed in the Canal Zone are within the scope of persons protected by the equal employment opportunity laws. Aliens employed by Federal ^ agencies in other overseas areas are not so covered. In light of this ' ruling, the Company is preparing to conduct, on July 8, 1977, a minority census to identify minorities among our non-U. S. employees. Although we had previously administratively extended to our non-U.S.citizen workforce the opportunity to have equal opportu- nity complaints heard within the agency, this action by the Civil Service Commission obligates us to follow somewhat more cumber- some procedures in processing complaints, including a right of appeal to the Commission and to the courts. The new ruling applies not only to our 10,000 non-U. S. citizen employees but also to the more than 20,000 applicants for employment with the Company/Government. To complicate matters, there is considerable confusion among employees and others concerning the applicability of the Civil Rights Act to complaints of discrimination on the basis of citizen- ship. As you know, the Civil Rights Act prohibits discrimination on the basis of "national origin," meaning ancestry or ethnic heritage; this particular act does not prohibit discrimination on the basis of "nationality," meaning citizenship or current political allegiance — although such discrimination is unlawful in certain contexts under other laws. Understandably, U.S. citizen employees who feel that they have ji been treated less favorably than Panamanian employees and Pana- (| manian employees who feel that they have been treated less favor- ably than American employees do not make these careful linguistic distinctions and, consequently, an increasing number of complaints are being brought in the EEO framework which in the agency's view do not belong there. The Company is working with the Civil Service Commission to ascertain how this problem is to be resolved, hoping thereby to avert a situation in which practically every personnel-related deci- 107 sion in the Company/Government would be susceptible of challenge as an EEO matter solely because employees of both nationalities I are involved. I These have been some of the more significant changes and con- cerns in the personnel area. Other matters now being reviewed include eligibility for home leave travel and repatriation, and new federal wage system job-grading standards, which may adversely affect some 800 manual employees. It is hoped that any adverse impact of these actions can be cushioned by some form of grandfathering. Universal Tonnage Measurement System The Committee has expressed an interest in the Company's attitude toward using the Universal Tonnage Measurement System as the basis for payment of Panama Canal tolls. As you may know, the Universal System is contained in the 1969 Tonnage Measure- ment Convention which will come into force two years after 25 countries representing 65 percent of the world's commercial ton- nage ratify the convention. At the moment, 30 countries have signed representing some 55-60 percent of world gross tonnage. The major holdout is Japan, with about 10 percent of the world's tonnage. The United States, with approximately 4 percent of the world's tonnage, has not yet ratified the convention, but in any event the Presidential message recommending ratification by the Congress specifically exempts the Panama Canal from mandatory use of UMS. The Company has reached no decision as yet on whether to continue with the present Panama Canal tonnage system after the 1969 convention comes into force or whether to recommend a change to a new or revised system in accommodation of the conven- tion rules. Although the Company favors the concept of a universal measurement system, the decision to change to a new toll system will depend to a great extent on how the system would affect the relative distribution of tolls among the individual ships using the Canal. Earlier studies made by us indicate that adoption of either convention net or convention gross rules would result in tolls against individual ships significantly different from current tolls even after adjustment in rates to equalize Canal revenue. The studies also showed that the 12-year transition period would pose serious problems for the Canal with respect to rate structuring and revenue stability. Whether or not these adverse effects can be satisfactorily minimized is among the questions currently under study. Canal Traffic I Concern has been expressed that the 19.5 percent toll increase that went into effect on 18 November 1976 might have an adverse effect on Canal traffic. Actually, since the date of the rate increase there has been an increase in the total cargo tonnage transiting the Canal, so there is no way to measure if any traffic has been lost bcause of the tolls increase. There has been a slight reduction in numbers of ships transiting the Canal this year as compared to the 108 same period last year, but the number of large vessels is still increasing, thus yielding a higher average toll per transit. As a consequence, tolls revenues for the first 6 months of fiscal year 1977 are at target levels and in consonance with the projections used in the justification for the tolls increase. The traffic situation and tolls income picture could, however, be worsened if the dry season continues much longer in its present severity. The dry season months thus far are among the driest on record here. Water inflows to the lakes have been extremely low, with March being the second lowest of any month on record. Unfortunately, this followed a short rainy season during which it was impossible to fill the lakes before the onset of the dry season. Last year the minimum draft restriction was 37 feet, which is the allowance at the present time. However, we are now forced to consider the possibility of a 35 foot allowable vessel draft, and we have already advised shippers that the draft allowance will be reduced to 35 feet, 6 inches on 3 May 1977. In addition to its obvious impact on shipping, the water shortage also reduces our hydropower production capability, significantly increasing the cost of electrical power generation. Obviously we are looking for the onset of the rainy season to maintain lake levels so that large vessel transits will not be lost and hydropower generation can be resumed. Canal Safety Transiting vessels safely with a minimum number of accidents has been, and is, of continuing concern. Accident evaluation is used as the basis for channel improvements, for more thorough vessel inspection prior to transit, for revising training programs, and for developing safer operating procedures. Programs of seminars and discussions are periodically scheduled with locks personnel, towboat personnel and pilots in order to improve the coordination of the operating team. Channel redesign has been studied and is the basis for new dredging programs. Despite the foregoing, the accident record is not as low as we would like, although it is generally lower than that of historic levels. For example, between 1914 and 1974 there was an average of one ship accident for each 292 ships transited. In the five-year period 1972 to 1976, in spite of the increasing average size of ships transiting, the annual average for accidents had improved to one accident for each 406 total transits, principally because of improve- ments in procedures and capital acquisitions such as tugs, locomotives and lighting. Unfortunately, the average for the first half of fiscal year 1977 was about 10 percent below the all-time average, with an accident for each 267 total transits. However, this is too brief a statistical sample to establish a trend, and, in fact, the second quarter of the fiscal year showed an upward improvement, with one accident for each 361 transits. We will continue to take every reasonable measure to reduce accidents, and to minimize the ever-increasing financial burden which they impose. 109 Financial Management In the financial area, the operating results for the first 6 months of fiscal year 1977 are consistent with budget and, barring any major shortfall in traffic forecasted for the remainder of the fiscal year, we expect to attain the $4.2 million net revenues projected. Furthermore, we are still optimistic that the present toll rate will permit a break-even operation through fiscal year 1979, including payments to the U.S. Treasury in the amount of $9.3 million of deferred liabilities from fiscal year 1976 and the Transition Quarter. North Slope Oil The potential for North Slope oil could have a profound impact on future traffic and tolls. It now appears possible that some of this oil could pass through the Canal in early fiscal year 1978, reaching a rate of about 500,000 barrels — approximately 70,000 long tons — daily. This translates to about three large tanker transits per day. If this materializes, our tolls revenue could be increased by as much as $27.7 million and $36.9 million in fiscal years 1978 and 1979, respectively. Related costs would be relatively small. Therefore, this development would have a very favorable impact on our net rev- enues. Hopefully, we will receive sufficient notification to permit appropriate planning and implementation of measures to accommo- date this traffic. Conclusion The complexity of the issues and problems that abound in the Canal Zone makes it impossible for me to cover the situation in any depth in this opening statement. I have just tried to highlight those matters that I believe are most important and of greatest interest to you. Emphasis has been placed on morale and motivation of the workforce which is so necessary to mission accomplishment. Unfortunately, many of our employees are beginning to lose sight of the importance of their work. The treaty negotiations per se have been interpreted as a lessening of U.S. interest in the Canal and the timing of the changes in organizational policies have been viewed as a coordinated political effort to get rid of the U.S. citizen employee. These attitudes and perceptions must be dealt with promptly, directly and effectively. Management is dedicated to this end. The Canal is an important artery of world commerce and its continued efficient operation is obviously of considerable concern to the United States. In this regard, our employees are our greatest asset. We want them to know that. Recent developments will assist management in dealing responsi- bly and effectively with the challenges I have outlined. The im- provement in the economy, for one thing, will help by taking some of the economic pressures off the Company. The breakthrough in having employee assurances released concerning the U.S. position on employee rights is a positive step in the right direction. Too, these hearings are most helpful. The presence of the committee, as an expression of Congressional concern, demonstrates the impor- tance attached to the Canal and its employees at the highest levels of government. 110 What this all adds up to is demonstrable appreciation for the key role of the employee in the operation of the Canal. I am confident that this will be most meaningful to our dedicated employees and greatly aid in continuing the outstanding service to world shipping that has always characterized operations of the Panama Canal. Mr. Chairman, this concludes my prepared statement. I would be pleased to respond to any questions you may have at this time. Mr. Metcalfe. Thank you very much, Governor Parfitt, for the very informative and enlightening and very candid statement you made to us. It has been reassuring, I can tell you that. There are just a few questions on which I would like some clarification. I understand the Canal Company has established a complaint office within the last year for Panamanian employees of the Canal Organization to seek redress for their grievances. How does this affect your operation? How is it moving? Governor Parfitt. There is no difference between those employ- ees and our American employees, sir. All the employees are alike in terms of addressing their grievances. I see no change other than the fact that some of the EEO complaints I alluded to in my statement have the possiblity of snowballing because of the fact of the distinc- tion between U.S. and non-U. S. Every issue, almost every personnel issue, which involves a Panamanian and U.S. respectively, now, could be deemed as an EEO complaint. This is of concern to us. Mr. Metcalfe. Since there is a lot of tension, more so than we would normally have, if we were not in the process of negotiating for a new treaty, by the mere fact that you have established a complaint office, do you find a lessening of that tension, the appre- hension, the lack of knowledge? Governor Parfitt. Well, anything we can do to provide further information is most helpful. I believe the worst situation is a lack of information. It is that fact that has caused most of the stresses and strains, the fact that people have not been informed to the extent they would like to be informed. The more we can do to advise them as to the internal policies, changes, and rationale therefore and what's going on in the treaty negotiations, the better off we are all going to be. Mr. Metcalfe. The Panama Canal Company has done an out- standing job. What about the Panama Government? They have also set up a complaint office, have they not, and, if so, would you comment on that? Governor Parfitt. I understand they have set up a complaint office and I have some concern to the extent — with regard to the extent to which Panama may attempt to become involved either in the operation of the Canal itself or in the personnel policies and practices of the Company/Government. We have invited, in several instances, individuals of the Panama- nian Government to come into the Company organization and see what we are doing in terms of treatment of our employees. They have refused to do so on the basis that they do not recognize us as a valid governmental entity. Therefore, they continue to sit on the sidelines and to criticize the equality of treatment within the Company /Government, and I feel that continuation of that policy Ill would be counterproductive to the relations between the Panama Government and the United States Government. Mr. Metcalfe. Yes, especially in the light of the present ongoing treaty negotiations. That is in my judgment in tune with the present attitude and news that is emanating from Panama which show not a cooperative spirit but one rather of suspicion and I might even add antagonism. Did I understand from the reading of part of your text, that there has been an increase in the number of accidents in the Canal this year? Governor Parfitt. We have had a period of 2 months where we had an inordinate number of accidents, October and December of 1976 in this fiscal year. So they distort the average in the statistical analysis we follow. We think that is an aberration and is a very small statistical trend. We don't believe this establishes a pattern. As I pointed out, quite to the contrary in the first 3 months of this calendar year we have had an improvement in the statistics. Mr. Metcalfe. What would you say was the cause of these accidents? Is it because there have been maximum changes in personnel? Do you have the necessary technical people to prevent these accidents or could they have been prevented? Governor Parfitt. I hope they could. I think the very nature of the operation of the Canal, the facility that it is, means we are always going to have a certain number of accidents. Certainly we are trying constantly to keep them to a minimum. With the increase in the size of the ships, the constraints of the locks themselves, the wind conditions, the weather conditions, we are always going to have a certain number of accidents in the waterway and I don't believe that the statistics we discussed portend a worsening situation. I think we are going to be able to keep it within the bounds of historical experience. Mr. Metcalfe. Governor, when are you going to implement the zero-base budgeting concept into the Canal organization? Governor Parfitt. Prior to the receipt of the presidential guid- ance on zero-base budgeting — this goes back now about a year — we on our own initiative launched a trial, in effect, on zero-base budgeting. We took an element of the Company and we took an element of the Canal Zone Government. It happened to be the Schools Division in the Canal Zone Government and the Communications Branch in the Company and we have gone through a rather arduous, detailed, exhaustive zero-base budgeting technique. In the process thereof we have learned a lot, and we believe we will be able to translate that experience to fulfill the requirements of the presidential directives on zero-base budgeting across the entire spectrum of the Company/Government. We think it will be helpful. Mr. Metcalfe. You do offer certain priority for certain ships which transit the Canal. As I remember, I think one priority was for those that carried ammunition. Recently there was a question about a vessel that was transporting perishable goods and it has come to my attention and I am informed that priority was not given to this vessel. 112 Will you address yourself to that question, please? Governor Parfitt. With the exception of passenger ships, we do not give priority to anyone on transit of the waterway. The transit is based on first-come /first-served within specific rules of the road. I mean there are certain ships that cannot go through the Canal except in daylight under clear cut conditions; that is, able to transit gaillard cut without meeting another ship. Obviously if those condi- tions cannot be obtained when the ship's turn comes, it has to wait until they can be obtained. Basically we treat all comers on a like basis. We do not make exceptions, with that one exception which I mentioned, which is the passenger ship on a limited schedule. We do make a special ar- rangement for all passenger ships, without regard to nationality or registry. Mr. Metcalfe. In the last few months the Canal Company concluded an agreement with Panama concerning the export of sugar from Canal Zone piers. What is the general outline of that agreement? How is it working? Governor Parfitt. Sir, we did not consummate an agreement. Panama approached us with the proposition of providing certain services across our piers for both molasses and sugar and we responded to them and told them what we could do and how to accomplish it, what the charge for services would be. Panama did not choose to accept or even to respond formally to our initiative. We understand that they are going to export their sugar through one of their own ports. Nothing has developed on this proposal. Mr. Metcalfe. Now, in your presentation I don't know whether you specifically addressed yourself to the question of what the Panama Canal Company is doing to foster good relations with Panama. I know it is an ongoing program, but would you expound on that for us, please? Governor Parfitt. Well, I think basically there are no new initiatives at the present time. We continuously establish good rapport with the Panamanian public by things we do for them through private organizations, through liaisons which we have at the lower levels of the Company and the Government. For example, we have technical groups that get together and cooperate on interchange of electric power, on technical problems we may have in the provision of water and so forth. At the working level we extend ourselves to accommodate the needs of Panama and likewise normally they to us. Unfortunately, that same level of relationship does not exist at the top levels because of the Panama- nian insistence that there is no legal governmental structure here. Mr. Metcalfe. You may be able to answer this next question rather succinctly. What has been the result of the Company's study of docks and piers as was carried out this last year? Governor Parfitt. We made an analysis of whether or not in fact at this time it would be prudent to go to a port authority concept of the way in which we handle our docks. In light of the treaty negotiations and all of the other changes that are being effected in the Company/Government, after receiving that study I decided to shelve the study and put it aside and say it would provide some good information and background and we would again address it 113 when we know a little more about what's going to happen in light of a treaty. To answer your question, the study has been completed, set aside as good information and a good basis upon which to adjust and adapt to whatever evolves in the treaty. Mr. Metcalfe. I have received a number of letters and com- plaints which are addressed to me as Chairman of the subcommit- tee regarding racial discrimination in the Canal Zone. Would you please respond as to what the nature of this is? I know that we have had conversations socially and informally in regards to some of these complaints. A most recent letter I received, for example, was from a gentleman who was a constant complainer of violations of his rights, and. he thought that he was being wronged in a particu- lar situation. Would you please indicate to us the nature of the discrimination? I want to make it crystal clear that we think you are doing everything possible to eliminate discriminatory practices and we want to applaud you at this point for taking steps that I recommended to you some 3 or 4 years ago in which I proved to be right in regards to desegregation of the schools, and the removing of the citizenship restrictions in housing. I want to get into that later on during these hearings, but would you like to further state your position? Governor Parfitt. Well, let me say I believe the charge of racial discrimination is grossly and inaccurately distorted. Certainly there is no policy — there is every attempt on our part to remove any vestige of discrimination in the Canal Zone. We do not think they exist. Having said that, it is unfortunate that Panama has in the world forums and in the press continued to charge the Canal Zone with practices akin to apartheid without being specific. It is my feeling that they are distorting the term ''discrimination" and in the minds of the recipient of that information to infer a color discrimination when in fact in many cases the discrimination that is discussed, rightly or wrongly, is differences of treatment of Panamanian citizens and U.S. citizens, many of which are based on law. The tax factor, for example. There is a difference in pay based on tax factors by law. So is the Tropical differential. There is the fact that we do not house all Panamanians as we house Americans. So they translate these distinctions and differences which exist on the basis of citizenship into one of racism and I don't think it is I proper. I think it is very upsetting to the good relationship to have this continue. Now, we do have from time to time charges, as any organization does, of a pure, pure case of racial discrimination, and we address them positively and directly. We take the proper action if it is i determined to be such. Basically, I do not think we are guilty of the j charge of racial discrimination. I Mr. Metcalfe. Briefly, I just want to ask this question for I purposes of an evaluation. There was a drinking problem among teenagers and Congress passed some legislation which would correct I that. Has there been any evidence that there has been any diminu- tion of drinking among the teenagers? Has the law been effective? Is it being implemented? Governor Parfitt. I am not sure if I can answer that accurately. We have made some other changes in the facilities that are avail- 114 able to the teenager which have removed some of the ready avail- ability and this has had an effect. From my own personal observa- tion, there has been a diminution in the alcohol problem. But whether to relate that to a change in the law, I am not sure. But, nonetheless, there seems to be a diminution both in the drugs and in alcoholism from what I can see. That does not mean we do not have a problem. We continue to have a problem but it is not to the extent that it has been in the recent past. Mr. Metcalfe. I have other questions, but I see the time is fast fleeting and I certainly want to give the gentleman from New York an opportunity to ask some questions. Mr. Zeferetti. Thank you, Mr. Chairman. Governor, I think we are all concerned about the morale of the U.S. citizens working here and the increase in resignations. What is the actual tenure? What is the average length of service for U.S. citizen employees? Governor Parfitt. I am not sure about the average, but basically most employees come to the Canal to spend an entire career, and leave normally when they are 62 years old, which is a mandatory time of retirement if they have 15 years' service in the Tropics. Normally people who come to work in the Panama Canal, in the enterprise, come with a life commitment, so they are normally lifelong employees. I think this translates into the effectiveness of the organization, the fact that they are long term and therefore very skilled in their work. Mr. Zeferetti. What you are finding today then is that the people who are coming, either spend a short period of time and then leave, or leave after a long period of time because of the negotiations? Governor Parfitt. There are two categories. One is that of the individuals who have accumulated enough time to voluntarily re- tire, who can be voluntarily retired before they are 62, if they are 55 and have 30 years' service. There are more of those who seem to be willing to move out rather than wait out the 62 years. But, more importantly, in my judgment, has been the number of individuals who early on in their career look at the situation and opt to leave, to go elsewhere, based on what they see unfolding in the future. Now, the numbers, yes, are not alarming. The fact is, that in a stable organization the numbers have always been low and even the numbers today are relatively low, but the trend, the percentage increase cannot help but be of concern. We are worried that this is going to be snowballing. We haven't got to a critical stage yet, but we want to address that so that it will not get to a critical situation. It is not today. Mr. Zeferetti. When these people arrive, Governor, are they people that have already been trained in the States and who have come here as professionals? Governor Parfitt. The answer is yes, sir. Take the example of the pilots, although they are trained professionals, they are not trained pilots, and we have a long training period to adapt their experience and expertise in the general field of navigation to the specifics of the Canal enterprise. That generally pertains to most of our skills. To translate their 115 professional background and knowledge to the actual situation on the ground. That does not pertain to the medical profession or anything like that. But to the electricians and machinists and pilots and tugboats, the thing there is the specialized knowledge that they have as a base for the circumstances here on the ground. Mr. Zeferetti. Is there anything similar in operations for the Panamanian people — teaching them the same techniques, the same kind of professionalism here in the Canal Zone? Governor Parfitt. We have an apprenticeship program that deals with many of the technical areas, such as the machinists and electricians. It is a 4-year program where we bring in raw recruits as it were, with base qualifications and teaches them these trades and train them. That is providing a greater degree of input into our technical field. We do not have a similar situation in the pilot and tugboat master force, which is of some concern to us. We have to look at the world pool of people who are at sea to provide the source of input to our training. Mr. Zeferetti. The reason I ask that question is that when you talk about the treaty that is apparently being structured it indi- cates a complete pull-out at the end of a period of time. I am thinking if there is no mechanism in place right now, how do they make it happen themselves? Of course, if over this long period of time the technicalities of the professions are not taught here, I think it is a real problem that one should consider. Governor Parfitt. This is true. I would think that the programs we now have unfolding, which would take care of many of the skills, the engineers, the technicians, the electricians, the machinists and so forth, would not be adequate to bridge the gap that we referred to in the fields of the tugboat operators and pilots. Some other avenue will have to be found to provide the Panamanian input for those areas, or they will have to provide or hire third-country skills at the time they take over the operation. Mr. Zeferetti. Staying on the subject of the employees for an- other moment or two, the conditions that you are aware of that have taken place already, in the negotiations; has that been trans- mitted to the employees? Have they been notified of the written conditions? Are they informed as to whether or not the Panama- nian Government is in agreement with the conditions? Governor Parfitt. Well, first, until the 15 Assurances I referred to, until that time, the negotiations have been conducted in more or less of a security mode. So the information available to the em- ployee has been limited, particularly as it related to their perspec- tives on employment conditions and so forth. Until assurances were given to them, the employees felt they were inadequately and only generally informed, which was a gen- eral statement of fact. Upon that announcement of assurances, they were announced as being the position of the U.S. negotiators; they had not been negotiated with Panama although I am sure they had been dis- cussed. Panama has chosen through the press and official an- nouncements to disassociate themselves from those assurances and 116 has made some extreme statements about their acceptability and so forth. So I would say at the moment Panama is on record as having some objection to those conditions. Our employees viewed this as meaning there is a long way to go. Mr. Zeferetti. What about the guy who feels such a case exists against him, wants to pick up and go? Governor Parfitt. Nevertheless, as I see it, good or bad, the restrictions that we have laid on them that are important to our employees, leaves the individual with a situation wherein he wishes that he had before him more facts so he could make a valid judgment as to what was in his best interest. So I thought it was in such interest to have the information good or bad, as sketchy as it might be, and also in the interests of the organization because I felt that once he knew in detail he could more appropriately deal with it. The worst thing for him would be to deal with innuendoes, suspicion and naked rumor, and this is what employees do until they pick up a conclusion which is the worst conclusion they could draw. I think it is helpful to extend ourselves to get on the table as much information as possible and I am very pleased to see this breakthrough. Mr. Zeferetti. Governor, you use the word ''security" down here quite a bit. Who comprises the security force and what is it? Governor Parfitt. The word "security," unfortunately, is used in many contexts. I think if you were to ask us what is included in our security force in the Canal Zone we would respond and say it is our police force, uniformed officers that enforce the law, and we have a protection division which is a security force that provides, like private policemen would, a security guard on special facilities like our locks and so forth, and we have in effect two security forces. But I feel that perhaps you may be alluding to another statement we made which relates to security positions, which is a term of the treaty of 1955 where I indicated that it exclude from the equal employment opportunity provisions of the treaty those positions that are set aside for American citizens on the basis of security. The implementing law established the fact that the entity, the organiza- tion, could establish three types of positions, three types of security positions. One was security of property, one was security of informa- tion, classified information, and the other was a category so-called continuity of operations, a group of people you needed to insure under unusual conditions a continuity of operation. Responding to that general language of the law, the entity estab- lished — these are rough numbers of figures — approximately 2250 positions they set aside and said, 'These must be occupied by U.S. citizens," and covered the whole spectrum of the organization, people such as policemen, the protection division, some in the locks, and throughout the entire organization. Over the years Panama has looked upon this as being discrimina- tory and blocking their progression, the upper mobility of the Panamanians. So, over the years management has responded to that criticism by reducing, ever reducing and whittling away the numbers, and when I arrived here 2 years ago the number had been reduced from 2250 to roughly 1,080. There were still complaints and criticisms and so we took another 117 Mr. Zeferetti. Was that an arbitrary or a self-regulating, deci- sion to reduce that number on your own? Governor Parfitt. It is within the prerogative of management to determine here. No numbers were ever established. Only the con- cepts and the definition. The numbers were left to the discretion of management. As I say, we have now reduced the number from in the thousands to about 580, and I am convinced that until all of those are removed, Panama will charge that we are discriminating to a certain degree bcause we are blocking certain positions. I think we have responded to their main criticism because we have opened up avenues of progression at least, so that there are not blocks. People can aspire to higher positions and do not have a layer of positions that blocks their upward mobility. That is one of the things we have been trying to do in revising these criteria for establishing security positions. Mr. Zeferetti. Mr. Chairman, I hope you can tolerate and put up with my taking up so much time because it is all new to me. I'd like to ask a couple more questions if I may. You make a statement on page two, that the press releases in Panamanian newspapers present as fact their versions of the contents of treaty talks and attack the Canal Zone and Canal employees. Would you comment on that? Governor Parfitt. Well, yes, they are in periods, this goes in assigned periods when we have ups and downs. We seem to have periods when we have a good relationship and we are getting along well and there are periods when the Panamanian press chooses to launch out — I will give you one example: During the January 9, 1977 riots they vilified the United States in general and Canal Zone employees specifically and dredged up all of the complaints from the 1964 riots and then charged periodically that Canal Zone employees with inciting anti-governmental activity in Panama, housing and protecting dissidents of Panama, providing them a base to launch anti-government attacks, unfounded in many cases, in all cases that I know of, charges against the employee, and the Canal Zone in general and sometimes the U.S. in general. So there is a constant beat down here. You live in a kind of a fishbowl with a drum beat. Mr. Zeferetti. Let me ask you a hard question: Are they anti- U.S.? Governor Parfitt. I do not think the Panamanian people as a group are anti-U.S. at all. Mr. Zeferetti. Is the press? Governor Parfitt. In the press, in the main I would say yes. They express it as anti-Canal Zone more than as anti-U.S. It is the thesis built upon the proposition of the government that there is no governmental structure in the Canal Zone, and there is no Canal Zone per se, that this is Panamanian territory and it builds on that, so there is a constant attack against the legitimacy of — in the first instance the Canal Zone, and then against every rule or regulation or law in the Canal Zone which is inconsistent with Panamanian law or rule or regulations. It provides a constant forum of attack, and in many cases they unfortunately transcend generalities and pick individuals, which exacerbates the situation that much more. 118 Mr. Zeferetti. Have there been many occurrences of violence against U.S. citizens or anything like that? Governor Parfitt. No. It has not translated itself into a great number of cases of violence. We have instances, but as a matter of fact, violence on the scene throughout Panama and here is rather infrequent. Mr. Zeferetti. One last issue. There has been quite a bit of testimony in the area of human rights and human rights violations, so to speak. Would you like to comment on that just a little bit? There has been some heavy testimony, by one individual. Governor Parfitt. Well, this gets into an area where I cannot speak with any degree of knowledge or accuracy. I would think the State Department can more adequately and accurately respond to the questions of human rights treatment in Panama. I know there are many charges that they do not provide protections on human rights. I know it concerns our employees from the standpoint that if jurisdiction were transferred that that same lack of human rights would translate from Panama into the Canal Zone and this is the source of many comments and concerns. But the validity and accuracy of them I cannot, from personal knowledge, say. Mr. Zeferetti. Governor, thank you very, very much. You have been very, very informative to me. Thank you, Mr. Chairman. Mr. Metcalfe. The gentleman from Indiana, Mr. Hillis. Mr. Hillis. Thank you, Mr. Chairman. I have a couple of questions. I would like to ask the Governor, apart from your dual role as Governor of the Zone and President of the Panama Canal Company, I'd like your personal views as a general officer of the Army as to the present and continuing value of the Canal to our defenses and the current role and strategic position we find ourselves in — and, with the growing power of the Russian Navy, do you rate the Canal as important today as it was in World War II, or less important, or more important from a strategic point of view? Governor Parfitt. I do not believe that I am really qualified to make a firm judgment in that area. It seems to me that the Joint Chiefs of Staff should expound on that. The question gets down to, in my mind, the question of whether it is vital or whether it is important and if it is important, how important, and these are shades of differences. I have kept myself abreast of military think- ing in this matter and there is quite a diversity of thought. There are some knowledgeable people in the military who feel that this Panama Canal still serves a vital need. I think the official posi- tion — I don't want to speak for them, or the JCS — is that it has receded in value. It is still very important, but it is no longer a vital link. Certainly I would say from my knowledge here, I think that one aspect that I can respond to and that is the charge that the Canal, because of its constrictions, does not provide a ready means of access to the Pacific. I think it is often overstated. The last statistics I have seen on this is that the Navy consists of about 670, no 640 ships— of which I believe 13 cannot go through the Panama Canal. 119 Mr. HiLLis. You are addressing the issue of obsolescence of the Canal? Governor Parfitt. No, I am addressing whether or not it is a valid statement that you can transfer assets, Navy assets and so forth from one ocean to the other readily through the Panama Canal, and there has been a statement often times made that the ability to do so has been reduced over time because of the bigger ships. I am saying that although that is generally true in the world fleet, as it relates to the Navy, there are only 13 ships and that includes carrier ships that cannot use the Panama Canal so it is a small number. The same thing is true with the world fleet. About 92 percent of all the ships at sea can go through the Panama Canal. So it is sometimes overstated that today the Panama Canal is a great restriction. Certainly it is a restriction, but it is not a great restriction. Mr. HiLLis. We in the Midwest, and particularly the people in the East, are most concerned about having the availability of the Alaskan fuel when the pipeline opens this year, and I was very intrigued with your statement and testimony about the part the Canal could play in that. It is a fact, a supertanker cannot negotiate the Canal? Governor Parfitt. That is correct. I Mr. HiLLis. Would you envision off-loading on the Pacific side into smaller ships? Governor Parfitt. We have talked to some of the oil companies and they contemplate having a large supertanker anchored offshore and it would be a floating storage and you would have smaller tankers from Alaska to this floating tanker off the coast and then you would have these maybe 60,000, 50,000-tonners which can get through the Canal loading from that tanker that is anchored off there and going through the Canal back and forth providing a supply line from that storage point. Mr. HiLLis. Into New Orleans? I Governor Parfitt. Into New Orleans and other ports on the East I Coast. As I say, the figure given to us is about 70,000 tons daily when it reaches its maximum; we probably will begin to receive i that — if we receive it, it has not had a decision yet — we would ' probably receive it late this year, late this calendar year. Mr. HiLLis. This can also have strategic value as far as the > defense of our country is concerned? Governor Parfitt. That is correct. Mr. HiLLis. And the Canal would be very important from that standpoint to us? Governor Parfitt. Yes, I think so. Now there are other alterna- tives to moving that oil. These get hung up on environmental issues ' and so forth and there are many discussions going on about alterna- tives which may later come on stream. In fact, we are not looking at this as a long-term proposition because indications to us are that some other alternatives will be developed over time. Maybe in 3 years or so some pipeline system or something would be ultimately the answer rather than bringing it down through the Panama Canal for a long duration. So we are looking at it as short-term Mr. HiLLis. At least in the Midwest they are generally talking about a trans-Canada pipeline within 5 to 10 years. Plus you have the problems with the pipeline crossing another country. 120 Governor Parfitt. That is right. As I understand it, they are also talking about a pipeline that partially exists from Long Beach over to the middle of Texas and augmenting or expanding that. There are serious environmental issues that become involved in this sort of activity, and we think that certainly we cannot resolve those issues to provide the flow of oil and the only alternative to get it to the United States in our judgment that exists today is the Panama Canal. Now, the other alternative that has been discussed — and there are political problems and other problems in this, is to transfer assets. In other words, the assets from Alaska could go to perhaps say, for example, Japan, and their assets from the Middle East would come to us and there is a tradeoff, but our indications are that there are so many problems inherent in these other solutions that — the likelihood of our receiving the quantities I indicated are quite good. We hope it is true because it means significant inflow of revenues to us and with our high fixed costs revenues of that magnitude translate very quickly into net profits. Mr. Zeferetti. Mr. Chairman, will the gentleman yield for a minute. We have a cargo preference bill that is pending before our committee which would increase the imported oil cargo to the U.S. How would that affect, do you think, the Canal Zone, if in fact that became law? We are talking about 20 or 30 percent of our ships carrying imported oil. Presently we are carrying only 4 percent. Governor Parfitt. You refer to the fact that a mandate that U.S. bottoms must carry Mr. Zeferetti. Must carry. Governor Parfitt. My information is that the capacity exists in the U.S. fleet to accommodate this concept that they are talking about and that the law would, in any event, require that it be done in U.S. bottoms. Mr. Zeferetti. I was wondering about what kind of effect it would have on the Canal itself I guess it would increase your — no, I guess maybe not. Governor Parfitt. Not necessarily so. It would not necessarily affect us, a fact that a lot of people do not understand is that our largest commodity going through the Panama Canal is petroleum and petroleum products, even today. Mr. Metcalfe. Thank you very much. Governor. Because of the time constraint, we will not be able to have questions of the staff as well as from Mr. Tannenbaum. I now ask unanimous consent that we be permitted to submit to you questions to which you may respond for purposes of the record. If there is no objection, that will be the order and I regret because of the fact that we are on a very tight time schedule the staff will not have an opportunity to raise questions at this particular time. I want to thank everyone for coming out and we will suspend the testimony in lieu of the further questions that Members may propound to you. Thank you very kindly. [Whereupon, at 10 a.m., the Subcommittee recessed.] 121 [After a recess, the Subcommittee reconvened at 10:15 a.m. in the Panama Canal Treaining Center, Balboa, Canal Zone, the Honroable Ralph H. Metcalfe (chairman of the subcommittee) presiding.] Mr. Metcalfe. The hearing will be in order. We have the Latin American Civic Councils to lead off the civic testimony this morning. I STATEMENT OF HON. RALPH H. METCALFE, A REPRESENTATIVE I IN CONGRESS FROM THE STATE OF ILLINOIS Mr. Metcalfe. In the past the U.S. Civic Councils have testified first. Today we sort of reversed the procedure. We have asked the Latin American Civic Councils to lead off the testimony. Distinguished members of the Civic Councils, ladies and gentle- men. The Panama Canal Subcommittee is here today to listen to your concerns, your ideas and your petitions. Since we last heard from you, many of you have written to the Subcommittee or have been otherwise in touch with us. Of course. Governor Parfitt has explained to the Subcommittee many of the problems and senti- ments that you have so at least I am somewhat familiar with these problems. Nevertheless, we felt it necessary to receive testimony directly from you. After your testimony, we hope to take positive and constructive action to do what we can to alleviate some of the difficulties you face. Of course, we recognize that we can only do so i much. I am very happy that we have two distinguished Members of Congress with us today to listen to your concerns. Congressman Leo Zeferetti of New York at my immediate right is a member of the Panama Canal Subcommittee and a representative of a congres- sional district in New York which is very much concerned with maritime commerce. Congressman Elwood 'Bud' Hillis deals with the Canal from the perspective of the important Armed Services Committee. I would like to give each of these gentlemen an opportunity to say a few words. Prior to doing so, let me identify the other people seated at the table. To my immediate left is Mr. Terry Modglin, Staff Director of the Subcommittee, of the Majority, and to Mr. Hillis' immediate right is Mr. Nick Nonnenmacher, who is the Minority Staff Director and we have Mr. Bernard Tannenbaum, who is a person whose aid we have recently sought in helping us in the period of negotiations. To his right is Mrs. Carolyn Robinson, who is a member of the staff, and to her right is Mr. Coleman Conroy, who is my Legislative : Assistant, and I might add a few extra things besides that, including being very active in having frequent conferences with Mr. Modglin and myself I am very happy and pleased that he could come down and participate in these hearings, get a bird's eye view of what we are planning to do and what we have done. So, may I now open the floor to Mr. Zeferetti, the gentleman from New York, for any opening statement that he may wish to make at this time. 95-549 - 77 -9 122 Mr. Zeferetti. Thank you, Mr. Chairman. I just welcome the opportunity, as a new member of the committee, to hear the testimony and welcome the opportunity to visit Panama and to personally view what is going on. Hopefully we can, through your testimony and through the testimony of others, get a real feeling as to the negotiations that are going on and the needs of the Panama- nian people, and U.S. citizens. I want to thank you for coming today. Thank you, Mr. Chairman. Mr. Metcalfe. Mr. Hillis. Mr. Hillis. Thank you, Mr. Chairman, may I also say how happy I am to have an opportunity to be here. It is also my first visit. I am learning a great deal and I look forward to hearing your testimony. I am sure it will inform. Mr. Metcalfe. I think it is proper now that Mr. Eugene Johnson, who is President of the Congress of Latin American Civic Councils, simply identify himself and then we will go to your right or to your left. STATEMENT OF EUGENE A. JOHNSON, PRESIDENT, CONGRESS OF LATIN AMERICAN CIVIC COUNCILS Mr. Johnson. Thank you very much, Mr.Chairman. I am, of course, first of all, Eugene A. Johnson, President of the Congress of Latin American Civic Councils. I am also President of the Pedro Miguel Civic Council. Chairman Ralph H. Metcalfe and members, Panama Canal Sub- committee, the Committee on Merchant Marine and Fisheries.I would like to extend the appreciation of the Congress of Latin American Civic Councils to again be able to testify on matters concerning our Latin American communities. Accompanying me this morning are the following gentlemen: Samuel Blenman, Presi- dent, Paraiso Civic Council; Clarence Gordon, President, Santa Cruz Civic Council; and Phillip Henry, President, Rainbow City Civic Council. I, besides being President of the Congress, of Latin Americn Civic Councils, am also President of the Pedro Miguel Civic Council. We would like also to commend you, Mr. Chairman, for the unique and positive manner in which you perform your duties as Chairman of this distinguished Subcommittee. Your unbiased inter- est and straightforwardness make us all aware that you not only have great concern and interest in our problems, but that you likewise make all effort to relieve the many tense situations here in the Canal Zone. Mr. Chairman, we must express our appreciation to the United States Government for providing us with an insight into its position as it affects Canal employees in the treaty negotiations. We refer directly to the ''Assurances for Present Employees of the Panama Canal Company/Canal Zone Government Under a New Panama Canal Treaty." This is the first time that we have had any concrete statement as to the direction of the negotiations. We would like to take this opportunity to address ourselves to the assurances as derived from the United Sttes' position on treaty 123 «i | negotiations. Even though we realize that changes are inevitable, ■ the assurances project a dismal future, particularly for the non-U. S. employees of the Panama Canal Company/Canal Zone Government. Further, there are areas which are nebulous and in direct conflict with our status as non-U. S. residents which have added to our apprehensions and seem to threaten our very existence. We are perturbed by the thrust of the ''assurances"; however, we will only discuss those points which we consider most bothersome: , a. We fear the loss of medical care to non-U. S. employees who opt li for Civil Service retirement, inasmuch as assurances have been given only to U.S. citizen employees and their dependents for medical attention under a new Canal Adminstration. b. Another area of deep concern is that of the future of non-U. S. students who will be in the Canal Zone school system when a treaty goes into effct. Again assurances on this issue were given only to I U.S. citizen employees. I 0. Still another area of preoccupation is that relative to the application of Panama labor laws under any new treaty. The ' implication is that there would be a dual treatment for employees according to nationality since the Panamanian labor laws will apply to non.-U.S. citizens whenever possible. I In addition, no definitive assurances have been given to non-U. S. ^ employees who may be displaced by land turnover or termination of Panama Canal activities, specifically schools, housing and medical care, and, an additional note, police and firefighting services and postal operations. Hundreds of families will be forced to relocate and readjust under i conditions that may prove adverse. It is our opinion that our precarious plight could be remedied j should the United States Government view all employees of the I Panama Canal Company/Canal Zone Government, not as nationals of any particular country, but as federal employees. A further observation is that any treaty concluded under the present guidelines will displace a significant number of employees of the Panama Canal Company/Canal Zone Government, with very little prospect, locally, for either comparable gainful reemployment or employment at all. There is considerable apprehension among the non-U. S. citizen workers of the Panama Canal Company/Canal Zone Government concerning their future livelihood and their abil- ity to maintain the present standard of living which we have strived so hard to achieve under the most trying circumstances over the years. We continue to urge that, through your good offices, revisions in the immigration laws be instituted to ease access to the United States for non-U. S. employees and their dependents, and/or that some other avenue through which these employees who have [■ dedicatd their lives to the operation of the Panama Canal, be relieved of their anxieties for the well-being of their families and themselves. Sirs, we have addressed ourselves mainly to the 15 assurances presented to the Canal Zone community by Governor Parfitt. This we did in the interest of time; however, even though we are extremely preoccupied with all aspects of the treaty negotiations, 124 we are also very concerned with the present operations of the Panama Canal Company/Canal Zone Government insofar as they affect housing, schools, and upward mobility. These points we would appreciate discussing with you, either formally or informally, at some other time during your inspection visit. Mr. Chairman, gentlemen, again I must express the gratitude of our Civic Councils for the opportunity given us to appear before this august body. Mr. Metcalfe. Thankyou very much, Mr. Johnson. We will not entertain any questions right now. I think it will be better if we move right on to hear from each one of the presidents who wish to make a statement and then we will start questioning. STATEMENT OF SAMUEL H. BLENMAN, PRESIDENT, PARAISO CIVIC COUNCIL Mr. Blenman. Thank you, Mr. Chairman. The Honorable Ralph H. Metcalfe, Chairman, Subcommittee on the Panama Canal, Com- mittee on Merchant Marine and Fisheries, House of Representatives. Dear Mr. Chairman: We sincerely appreciate the opportunity afforded us by your honorable Committee on so many occasions, to express our views on the very crucial issues whch affect adversely the Latin American community. A very striking contrast to previous years, we seem to see as a people, the democratic spirit more and more in evidence in the Panama Canal Zone, and we accordingly feel that it should be less difficult for us now to be accorded some appreciable recognition as employees of the United States Government. We have studied with much interest and dismay the list of assurances presented some time ago by Governor Parfitt to labor, and civic council representatives. The difficulty with this list is that it does not offer any meaningful protection to the non-U.S. citizen employee, who may become displaced as a consequence of a treaty between the United States and the Republic of Panama. However, it refers at length to the benefits that U.S. citizen employees must continue to enjoy in the post treaty era, to the exclusion of their Panamanian counterpart. For instance, schooling, medical care, adequate housing, duty-free import, and even the use of miltary service facilities. We are happy to observe that the list of assurances is in accord with the United States Government's position, in any treaty with the Republic of Panama, and we are inclined to believe that it aims at alleviating current fears and suspicions among employees, and demonstrating to them the determination of the United States Government to protect employee rights and privileges. We sumit that it will be just and graceful to extend this protec- tion to U.S. citizens and non-U.S. citizens alike. In this regard, we suggest that certain exceptions contained in the list of assurances be removed, with a view towards improved protec- tion for non-U.S. citizen employees. We firmly believe that the exceptional service rendered by our forefathers in the building of the canal, and the continued faithfulness of their offspring in the 125 service of that enterprise, are elements which should warrant us no lower status than that accorded citizens of the United States. Yours very truly, Samuel Blenham, Paraiso Civic Council. Mr. Metcalfe. Thank you very much, Mr. Blenman, for your very fine statement. We will now move on to one of the other presidents of the Latin Civic Councils. STATEMENT OF CLARENCE G. GORDON, PRESIDENT, SANTA CRUZ CIVIC COUNCIL, CANAL ZONE Mr. Gordon. Thank you, Mr. Chairman. I am Clarence G. Gor- don, President of Santa Cruz Civic Council. Mr. Chairman, members of the Subcommittee, thank you for giving me this morning the opportunity to submit for the record an evaluation of the progress made since the Subcommittee on the Panama Canal last visited the Canal Zone to hold open hearings on the subjects of concerns of residents of the Canal Zone and employ- ees of the Canal Zone Agencies. Mr. Chairman, the Santa Cruz Civic Council wishes to express its appreciation to you, and members of the Subcommittee, and Canal Zone Governor, Harold R. Parfitt, for the significant changes made on the issues of schools, upward mobility, and housing. Governor Parfltt's announcements on November 10, 1975, to consolidate the housing of the U.S. and Latin American communi- ties, to merge the U.S. and Latin American schools, and to reduce the number of security positions in the Canal Organization, and the implementations of these announcements in March and April, 1976, are steps in the right directions. Inasmuch as some officials may feel that some of the remaining problems that are still of deep concern to us, as Panamanians, are in house problems for the local Canal Zone Company/Government and Civic Councils to solve, I just want to say very briefly that on schools it is the Congress of Latin American Civic Council's desire that the merging of the Latin American High Schools will be completed by March of 1978 as the prolongation of the Latin American High Schools beyond March of 1978, with a diminishing pupil-teacher ratio, would only make it difficult to continue satisfac- tory programs, which will not offer our children quality education. With respect to housing for Latin American employees, the new housing criteria implemented on April 7, 1976, and the Interim Amended Housing Regulations approved on December 22, 1976, will not permit a cross-section of Panamanian employees of all types of jobs to apply for quarters in the Canal Zone in the future. These new housing regulations w^U only continue to widen the scope of resentment from the Panamanian employees who work with loyalty and devotion to the Company/Government for an efficient oper- ation of the Panama Canal for the benefit of world commerce irrespective of the uncertainties that are ahead for these workers. It is our Civic Council's view that the new housing policy which permits a cross-section of U.S. citizen employees of all types of jobs, and a selected group of non-U. S. employees to apply for Canal Zone quarters, is an unfair treatment to other groups of non-U. S. employ- ees, who are equally important to the maintenance and operation of the Panama Canal. 126 Treaty Negotiations As the United States Government and the Panama Government approach closer to resolving their differences on a new Panama Canal Treaty, it is the hope of all employees of the Canal Organiza- tion that all fringe benefits gained over the years will be protected and continue to be enjoyed by all workers in any new treaty. The Santa Cruz Civic Council requests that this Subcommittee, the Company/Governent, and others in authority to continue re- viewing all programs implemented, so that both Panamanians and U.S. citizen employees will share equitably* in the operation and maintenance of the Panama Canal. Thank you. Mr. Metcalfe. Thank you very much, Mr. Gordon. Mr. Henry, do you care to make a statement? Are there any other presidents? I am going to reverse the procedure and rather than me ask questions at this particular time, I am going to ask Mr. Zeferetti, a member of the Panama Canal Subcommittee, to lead off with questions, and then we will go from him to Mr. Hillis, from him to the staff people, and then, if time permits, to me because it is very important that we have complete dialogue. It is of equal importance that both of these new members who have not been to Panama previously, who have not had the warm experience that I have enjoyed both with the Latin Civic Council, as well as with the U.S. Council, that they have the benefit of a full dialogue with the members and therefore I am relinquishing for the moment my right to ask questions. Because of the time factor, I want to make certain they get to know you as well as I know both civic groups. Mr, Zeferetti, the gentleman from New York. Mr. Zeferetti. Thank you, Mr. Chairman, and thank you, gentlemen. I think perhaps some of what you said conflicts with each other. In one respect Mr. Johnson and Mr. Blenman, you talked about the nonexistence or lack of concern for equal housing, schools and employment opportunities. Then at the same time, Mr. Gordon, you refer to the Governor's assurances which would allow for this type of change in the assurances. And, as a matter of fact that some of these already went into place. It has been going on as far as the schools are concerned and as far as housing is concerned. I would like to clarify this please; the differences that we are talking about. Mr. Henry. I am Phillip Henry, Rainbow City Council. These gentlemen are talking about two different things. Mr. Blenman and Mr. Johnson talked about the effects of the treaty. Mr. Gordon was talking about the present operation of the Panama Canal Company as it is now. Mr. Gordon was referring to the present housing policy as it affects schools and upward mobility. Mr. Blenman and Mr. Johnson are referring to the 15 points as it would affect these areas with the implementation of any treaty under the guidelines as we understand them. 127 Mr. Zeferetti. Well, what steps do you feel should be taken to go further beyond what the Governor has recommended at this par- ticular time? In other words, you started with the first four grades in school and you are acting on some specific changes the Governor has outlined. Aside from the treaty where you feel there should be changes, where you feel it should be in the treaty negotiations that should be outlined to benefit your children and your housing problems. Mr. Johnson. One of the areas that we believe from the Congress of Latin American Councils' point of view is that inasmuch as the Governor has opted for one of the plans, you see originally there were several plans which the Governor had used the prerogative of opting for, plans A and B and C, I think. One of these plans he opted for was to sort of gradually phase out the schools in years extended into 1980. We are saying in the Congress that rather than extend this — because during that time probably we would have the signing of a treaty anyhow — rather than extend it to 1980 — as Mr. Gordon's paper says — we are saying that it is open to us, grades 5 through 12 should be totally merged at this time — rather than to extend it over a period of time. Mr. Zeferetti. Have you the capabilities to do that right now? Have the schools the capability to Mr. Johnson. From our point of view, yes. Mr. Zeferetti. How about in your housing situation? Mr. Johnson. Okay, in our housing situation, again the problem that exists now that we are seeing a new treaty we are saying that the position has been presented for a Grade 11, only a certain group of people can apply for housing in what is called the U.S. community. We have this distinction. Mr. Zeferetti. Are we talking positions? What are we talking about as the guidelines for acceptance? Are we talking salaries? Mr. Johnson. Salaries. Mr. Zeferetti. Is it a question of paying the rent or is it a question of earning enough money to sustain, I guess? Mr. Johnson. The fact that it is salaries means economics have a lot to do with taking care of the rent for these houses in the U.S. communities. However, we have said over the years that regardless of a man's salary the option should be clear for all employees to be able to apply for housing in any community that he desires to live in, once he works for the company, and right now we have a cutoff and the people who make this type of salary. Grade 7 and above, are a minimum — something like a hundred, 125 employees now in the Canal Zone, and because of a reduced number we exclude who could opt to apply for housing in the U.S. communities. But, because of the salary cutoff, they do not have the opportunity. Mr. Zeferetti. Mr. Henry, is it true that, under the existing law there is a separation of salaries with regard to all the United States citizens who work in the Canal Zone are given certain incentives to be part of the system here versus the salaries of the Panamanian people. So under the existing law isn't there that kind of differen- tial any way? Are you saying that everybody should be the same? 128 Mr. Johnson. Basically. Mr. Zeferetti. I think the problem Mr. Metcalfe. Will the gentleman yield to me? Do I understand you, Mr. Johnson, in addressing yourself to the question of the transition in education, that you would want con- solidation to be all in one rather than two phases? Instead of going to Phase 1, Phase 2 and ultimtely for '78 in Phase 3 before we get to the twelfth grade you want consolidation in one move? Is that what you are asking for, that it be done at one fell swoop? Mr. Johnson. Yes. Mr. Henry. May I make some comment? Presently we will be in the second phase, where in September we will have grades 5 through 8 going over. We only exist in the Latin American schools now grades 9 through 12. And I think this was the area that Mr. Gordon was addressing. Grades 9 through 12 will stretch out until 1980 which would, as we see it, present a problem as far as programs and tracks are concerned. We do want one-shot phase in. Mr. Metcalfe. And in regards to the question of housing, you are also advocating that that consolidation be speeded up and that it not be phased in accordance with the present program as Governor Parfitt has outlined to us and which the Company has adopted as a modus operandi? Mr. Henry. Right now the present policy establishes a cutoff at NM-7 for acquisition of housing in the U.S. communities. Basically this is near to out. The Congress' position is that we should set at an NM-4 level which would make housing in the U.S. communities accessible to more non-U. S. citizens inasmuch as there is a limited number of non-U. S. citizens in the Canal Zone community at the NM-7 level. Mr. Zeferetti. It's at that grade level, right? Mr. Metcalfe. Mr. Gordon, if you will further yield Mr. Gordon. One big problem is right now in the U.S. community we have houses that should not be in the category for NM-7 employees and above because for those quarters, the rent is not as high as some of the rents in Pedro Miguel and Santa Cruz quarters. Now we see no reason why that some of these quarters should come under the cutoff of the NM-7 employee. We have wooden structure houses in the U.S. communities where the rent is as lo\y as $16 per every two weeks, and we couldn't see any reason why Panamanian employees should be exempted from these quarters. Mr. Metcalfe. I am not taking any position in regard to the statements that you have made. I would like to say that three years ago I made the public statement that there was need to integrate housing, to integrate education, to remove the security provisions at that particular time. I also said that the Canal Zone was trailing way behind the southern part of the United States in terms of an amalgamation of the people, their rights, and their duties and their freedom as well as their ability to get quality education, jobs and housing. The changes that were needed are being phased in in most communities. I would like for you to elaborate a little bit more, Mr. Gordon, because what you are asking for is certainly very important and I 129 want to make certain that I hear more of your argument to substantiate your contentions. I am not evaluating them, but I just think for the record we need to have more argument to see if there is and can we in effect have it. This is something that probably has gone on, and will continue to go on, between the Civics Councils as well as the Governor and his commission and his staff. I think this is an opportune time to elaborate on it. Mr. Zeferetti. I also feel if you have a phase-in progression in place; it works and is active, there is no harm in looking for the optimum wherever you want the best, but if it is working and you have it set in place where it can be effective, then I think it is something we have to look at real hard to see whether or not it is working and if it is, to keep it in place. If it can be improved on, that is something else too. But you know we all want to say 'Give us everything now, everything," but sometimes it is just not possible that way because of m.echanics. Mr. Johnson. I would like to bring to the gentleman from New- York's attention that we are not in direct contrast to what you are saying. We are not saying we want it right now because we are talking about 50 years. We have been saying this to the Subcommit- tee long before the gentleman Chairman has been Chairman. Way back we said this to the members in the first recorded minutes. This was taken at a time I was just a member, a floor member of this group. And these positions have been time and time and we have repeated them so often that the record is broken. So what we are saying now is not that we are asking for those things you indicate now. We have been asking for a long time. We have been saying that we think it's unfair to exclude a greater number of employees who should have access to housing, and to schools, because by using this standard which is way out of proportion we say in effect we have only a minute amount of noncitizens who can apply for housing. By the same token, because these people can apply for housing that means that we have only so many Panamanians who can now, so, their children can be provided quality education in our schools. What we are saying is that were this level to be dropped, then the number of Panamanians will be greater, so we can see a better balance. We are looking for that balance. Also, if we do these things when a treaty is signed, we would have included more people, we would have balanced the scale greater than we are right now. Where if a treaty is signed right now, in the near future, we would have excluded a great number of Panamanians who should , be included, in any provision, whether for housing or schools, or i what have you. So we are not saying tomorrow, because we have ! been asking since yesterday. Mr. Metcalfe. Since I have the time, let me just say, as a result i of the questions I have propounded to you and the questions and the i statements of the gentleman from New York, I think we are ' together in terms of what we are seeking and I don't want to ; monopolize his time. I'll yield back my time to the gentleman who has the time in the hope that he will pursue all of these questions, and I am sure you will recognize Mr. Henry. Mr. Zeferetti. Absolutely for us, please be assured this is a learning process and a dialogue. We are getting acquainted and so on. 130 To get back just one moment to what you said earlier, even though the goal is for a long period of time, it is nice to know it is finally in place and starting to move. That is the point I was trying to make. Mr. Henry, please. Mr. Henry. Housing in the context of the treaty is one of our concerns because the guidelines we have now indicate that certain land turnovers will go to Panama. The rumors are that this in- cludes a number of housing areas. Now this would displace people, and the land that they would be on would be in Panama. The 15 assurances do not provide any bright future for these people. It would imply that they would have to find housing accommodations if the Panamanian Government decides this should not continue as a housing area. Mr. Zeferetti. Mr. Henry, what role did the Council play, if any, in the negotiations with either the Panamanians or with ourselves? What role do your people play in this when it comes down to drawing up hard lines about what you feel the people need, whether it be the Panamanian people or U.S. citizens? Mr. Henry. Basically, the same role we are playing now. We are placing our concerns, our complaints, our aspirations to the authori- ties that have some input to the treaty. We don't sit at the table with the negotiators and present them a paper and say these are the things we want. We have to appeal to authorities or agencies that have that direct input in the hope that they will buy our argument and see to it that these are included in the treaty. Right now there is a feeling that the United Sttes Government, by virtue of operating the Panama Canal, has a responsibility to us. We feel we made this decision and we are here seeing to it that the Panama Canal operates. The treaty is going to eliminate at least more than half of the work force; then this is our preoccupation and we are appealing to someone who can get this put into the treaty. Mr. Zeferetti. I asked the Governor earlier this morning if he thought over a period of time when the treaty becomes a reality that the people involved, the Panamanian people themselves would have the ability to be trained for some of the specific jobs that will be necessary to carry forth the operations of the Canal. We haven't really gone toward that end. Mr. Henry. At that time the United States Government will have nothing to say about much of our training. Mr. Zeferetti. I am talking about prior to that time. Let's say for argument's sake — we will just throw out a date — say by the year 2000 we will get out of the Canal Zone and by that time we will not operate it; it will be left to the Panamanian Government. Between now and then, will the opportunity be available to the Panamanian people to be trained to take over the complete operation of the Canal? Mr. Henry. I suppose they could if the machinery is set up, but that is another question. Will this machinery be set up? Will the present employees of the Panama Canal/Panama Canal Zone Gov- ernment who have great potential, be given this opportunity and will they be given also the opportunity to be employed within the Canal administration? At that time the persons who will have the 131 say as to who is employed and so forth will not be the United States Government, but will be the Panamanian Government. Mr. Zeferetti. Then you feel that has to be part of the treaty negotiations? Mr. Henry. I would urge that this be a part of the treaty so there be no misunderstanding and that someone can sit down and, say, plan the future for themselves and, most important, for their I children. Mr. Johnson. I would like to add to that by saying that very strongly this ties in with some of the things we have been saying : over the years. In my paper I talked about upward mobility. Upward mobility is based on this. If 20 years ago more Panamanians were provided, given opportu- nity, as is done now, more Panamanians sent to supervisory schools as they are now, when that time comes, Panamanians would have been qualified to hold the type of jobs needed possibly, to be in a position to run and assist in the operation of the Canal, and this machinery is in motion but we are again saying that we hope that this thing is speeded up and more of us included. Mr. Metcalfe. The gentleman from Indiana, Mr. Hillis. Mr. Hillis. I fmd all this very informative, Mr. Chairman. I certainly am impressed by Mr. Blenman's closing statement as to the contribution all of you and your forebearers have made to the Canal and its operation over the years. It seems to me, of course, certain of these things have gotten under way, some of them directly at the suggestion of our chairman, and over the years can be phased in, can be worked in. But the fact that we are in this treaty negotiation creates an air of uncetainty, does it not, and you non-U. S. citizen employees would like to know what your status is going to be, and want to be represented, and have those rights clarified at this time in the treaty, and you want these things speeded up, but you also want to know where you stand after the treaty, is that right? Mr. Johnson. Very much so. Mr. Hillis. That just seemed to be my feeling, as to where we were. Mr. Metcalfe. I recognize now, Mr. Terry Modglin, our staff director, for the majority. Mr. Modglin. Thank you, Mr. Chairman. I would like to pursue three particular questions. The first concerns easier access for Panamanian residents of the Canal Zone to the United States. Your representations in this regard, with respect to easier access to the United States, are they related to the treaty or has this been a long-standing aspiration of your communities? I would like to establish that for the record. Mr. Johnson. This has been a longstanding aspiration. The record will bear us out on this. Way back, as we have talked with the gentleman we have tried to establish— and this is a fact that this has been an ongoing request to this Committee and to other groups and so at this time we want to reemphasize the fact that we look at this in the context that a treaty is soon approaching. 132 Mr. Henry. May I say some more on that? Though this has been a longstanding request the treaty negotiations and the assurances tell us thousands are going to be displaced and there is very dim likelihood of any comparable employment or, as I said, any employ- ! ment at all. We have precedents for this in the 1955 Treaty when certain activities were curtailed which displaced several hundred employees, but at that time the immigration laws were such that there was easy access to the United States, and a number did go to the United States. But a treaty under these conditions — people may just go by the wayside, because there is nothing to do, no prospects, nowhere else to go to seek anything. Mr. MoDGLiN. You are aware that in 1976 the new Immigration and Nationality Act Amendments were passed and this changed the basis for Western Hemisphere immigration. I am wondering whether or not the implementation of that new statute has yet had an effect upon individuals in your communities who aspire to go to the United States. Are there fewer or more Panamanian residents of the Zone going to the United States? Any perceptible change? Mr. Henry. I think we can talk about that. I am not very conversant with all this because I have not researched it, but I am of the opinion that access has less immigrant stages. People are going on other type visas. My feeling is that there is still a problem. Mr. MoDGLiN. If there is to be easier access to the United States for people in your communities, what standard ought to be set to effect this? Should the easier access be on a basis of persons born in the Canal Zone or should it be on the basis of service in the Canal Organization? What standards would you recommend be established if there were to be some legislation to effect this particular change? Mr. Johnson. The standard could include basically several of the things you mentioned there and at this time because we are not too familiar with the type of standards that could be used for easier access. I would refain from replying further but I would hasten to say that maybe some of the things you mentioned there should be used as a standard for easy access to the United States. Mr. MoDGLiN. There was a time, was there not, when a number of the individuals in your communities went into the U.S. Military Service and effected U.S. citizenship from that perspective? Now, is that still one of the chief means by which U.S. citizenship is gained by residents of the community here? Mr. Henry. We still have a number of boys and girls who enter the military services and they may eventually opt for U.S. citizen- ship. At the same time we suspect that they may have trouble getting immigrant visas because you have to be a resident of the United States to enter the armed forces. Mr. MoDGLiN. The second point I want to address is the issuance of the 15 Points. The 15 assurances delineate between Panamanian Nationals and U.S. citizens in terms of disposition under a new treaty arrangement. The remedy you suggested was that all Canal employees be considered federal employees. Could you just elabo- rate on the rationale, your rationale as to why all employees should be treated in the same manner without respect to citizenship and what you believe are the responsibilities of the U.S. Government to you? 133 Mr. Henry. Our feeling as far as the treaty negotiations are going and what we have heard there is an inclination to think of us as Panamanian citizens and that Panama will assume certain respon- sibilities for us as her citizens and it may be that these 15 assur- ances were written in this light and because of that the negotiators were hesitant to take a firmer stand in protection of the rights of citizens of another country. We are saying that if, as in some occasions, we are considered federal employees, then the assurances would extend to us as federal employees rather than dividing the federal employees — U.S. citizens, federal employees, non-U. S. citizens. Further, I would like to say what the 15 points does is that it begins a new line of discussion with the same problem that we had before — equality. We are saying that had the 15 points said all federal employees later on at the negotiation table this could have been worked out, but the way it is now, we find ourselves excluded mostly, and because we find ourselves mostly excluded, and we find quality begins again a new line, we say leave us alone and let's look at this 15 points in a new context although it hasn't been accepted by some of the parties. But let's begin here by saying that we are talking about government employees, federal employees who make the provisions that we do allow. And when we do this we will have lumped everybody together rather than as we have done here, in the 15 points. And this is where we would like it to be taken. Mr. Modglin. One final point, Mr. Chairman. There has been a good deal of controversy over the question of the United States maintaining a full government in the Canal Zone with police, fire, educational systems, et cetera. I would like to, if I could, solicit your opinions as to the fairness of the law enforcement in the Canal Zone and the system of courts and I know in years past you have made some representations about the jury system. So I would like to have your comments on this aspect of life in the Zone. Mr. Johnson. We have, ever since our forefathers have worked for the government, the United States Government, and we have understood the type of system here as basic to our hearts. We have known that the democratic system, under the police and court system that we have, like you mentioned. We requested jury selec- tion for Panamanian employees. We view this as an income in the continued safe operation of the Company. Now we are making a projection about what could happen were another entity to take over. But all we are saying is that democracy is what we have seen, we have understood it this way, and some of us are part of this democratic system of law enforcement and the judicial system under the United States Government and we have expressed a desire that this, if it were possible under any arrangement, be continued. We don't know what would happen if somebody else were to do differently but we feel as employees as we are that this has been workable as a condition and we would like to see this continued. Mr. Modglin. Thank you for allowing me the time. Mr. Metcalfe. Yes, Mr. Blenman. 134 Mr. Blenman. I would like to address Mr. Modglin, on the second issue he asked. In my paper here I mention benefits to U.S. employees continue under the treaty— housing and medical care. We understand that if the treaty goes through that the schools might go DOD. My question — what would happen to the children — my kids, going to U.S. schools? Will there be any implementation in the treaty allowing them to go there and finish their education? Mr. Modglin. I don't think that I am possessed of the informa- tion right now that would adequately Mr. Blenman. That is what I was referring to when I mentioned that. Mr. Modglin. To answer your question. Mr. Blenman. When the treaty is signed, does that mean all the kids have to go into Panama schools, private schools? Does that mean kids in U.S. schools, if they are in 11th grade, will be able to finish. I was wondering whether something could be injected into the negotiations which allow them to complete schools? Mr. Metcalfe. Why don't you put that in the form of a recom- mendation to us? Mr. Henry. In that same vein are some of our concerns. One of these is the conflict in opting for U.S. Civil Service Retirement by a worker or the Social Security in Panama, and medical care. Right now a Civil Service worker gets Civil Service benefits, and Canal Zone employees get medical care, health insirance, and so on. Under the Social Security System, retirement system medical care is a part of that retirement plan. Now, if you don't have that, what happens to the person who takes U.S. Civil Service Retire- ment and goes on? What happens to your health insurance and your medical care? The 15 points say U.S. citizens will be assured medical care. They do not see that non-U. S. citizens can be assured medical care. Do we have a health plan or do we get into private hospitals that are expensive. This is something that comes out of the 15 ponts that needs clarification. Mr. Metcalfe. Mr. Henry, I want to make certain that we are clear. Are you asking first that the Canal Company address itself to these needs, and hopefully you will have a solution and be satisfied with the response from the Company, or are you asking that in the absence of that the negotiators address the problem. I am hesitant to refer to the negotiations because you want an immediate answer to your question as to whether or not the negotiators will make this a part of the treaty. My problem is that we can't wait because we have no idea of knowing whether or not the negotiators will address themselves to this and will delineate the answers to your questions. Do you understand me clearly? I mean as to whether or not you would like to have the Governor and his Counsel address them- selves to these problems? Mr. Henry. Are you saying the Governor and his Counsel address himself to these problems with a view of later addressing the negotiators? Mr. Metcalfe. Even if it can be done prior to it and assuming — let's assume for the sake of time progress that the negotiators will not address themselves to it — you will have the assurance that your request has had some attention and maybe some solutions. 135 Mr. Henry. Well, you see, Mr. Chairman, right now we have U.S. Army facilities, and we have health plans so what I am talking about is in the contxt of a treaty as the 15 assurances are set up I am saying actually what happens to medical care for someone who says, "I want to continue under the U.S. Civil Service Retirement Plan." Because there are no assurances as far as medical care is concerned. I don't know what is going to be worked out for health plan, whether we will have a Canal Zone Health Board, whether there will be an option for stateside insurance companies, or what. Mr. Metcalfe. Mr. Henry, let me couch it in a little different language. In other words, Governor Parfitt has issued a statement of principles and of intentions of what he would like to see done. My question is, would you like him to addrss himself to that question and make that a part of his list of assurances? Mr. Henry. Yes. Mr. Metcalfe. Thank you. Do we have any questions from the Minority Staff member, Mr. Nick Nonnenmacher? Mr. Nonnenmacher. Thank you, Mr. Chairman I would like to phrase this as delicately as I can because I think it is more than just implied here. And I am well aware of the political ramifications as it relates to you Panamanian citizens. Mr. Johnson, you mentioned a duality, and, Mr. Henry, you mentioned the displacement. Now, it seems to me there is a "triality" involved here. I think you feel presently that there is sort of a duality in relation to the U.S. Government in these assurances in your present and potential positions, working under the present Company regime. But I get the distinct impression you fear a duality in relation to the Republic of Panama when and if that government takes over. And this is why I use this word ''triality." I'd like to ask you, why do you fear a displacement from your jobs in view of the great experience you people have? Let me ask two questions: What jobs do you expect to be abol- ished, and if jobs are not going to be abolished, do you fear a displacement by other Panamanians without experience, whether it be for political reasons or not? Why should that happen? Could you elaborate, either of you elaborate, on this question? Mr. Henry. Under the present guidelines of the treaty, it says that Panama will be sovereign within the Canal Zone and that at that time a Canal Administration will be set up that will see to the operation of the Panama Canal. It implies that all governmental functions and all functions that do not have a direct bearing on the operation of the Canal — that is, getting ships through the Canal — will divert to Panama. This wipes out, I would say, approximately half of the working force in the governmental functions, the policemen, firemen, postal service, and schools. And within the government operation, those other commercial activities in the docks and piers in Balboa, ma- rine bunkering, a lot of these activities are going to go. This means that you will displace workers. It seems to us that, first of all, all of these emloyees will not necessarily be re-employed, since Panama already has entities that assume these functions. We are abandoning the police; we are abandoning the firemen; we are abandoning the postal system. They 136 do do some rebunkering and all things like that. So all that may happen is that some of these functions will just extend themselves and I can't see any way in which even one-third of the present working force will be employed in these areas since we already have a working force within the Panamanian Government to assume these responsibilities. Mr. NoNNENMACHER. But would that same number of people be able to handle what seems to be an expanded geographical area? Would there literally be no need for additional people in the Panamanian Government agencies to carry on? Mr. Henry. Yes, you would need some more. Mr. NoNNENMACHER. Would not you people be the logical ones to keep this up? If not, why not? Mr. Henry. That is a very significant question as far as that is concerned. I would prefer to go into the details of that at some other time. Mr. NoNNENMACHER. Well, I think this is what I was trying to say, that it is a delicate issue and I appreciate that, but I think the record in some way should reflect this concern and I think your answer does. Mr. Johnson. May I just point out the fact that I appreciate the fact that you continued in this context because some of the issues that you raise are delicate in that sense and because of political ramifications we would rather not discuss them now but during the inspection visit perhaps you could talk to us about it and we could answer your question. Mr. NoNNENMACHER. I appreciate your candor. I would like to say on behalf of Congressman Gene Snyder, who is the Ranking Minority member, and who is not present today, that despite his very strong positon against the United States surrender- ing the Canal and the Zone to the Republic of Panama, he has an enormous respect for Panamanian citizens and especially for those like yourselves and your forefathers who built that waterway and have continued to maintain it to this present day. I would like you to know that you have his respect. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you, Mr. Nonnenmacher. Now we will ask Mr. Bernard Tannenbaum if he has any questions. Mr. Tannenbaum. I think the questions you have just raised certainly deserve a lot more discussion. If you prefer that discussion in private, we would be happy to discuss it with you at your pleasure. Mr. Metcalfe. Thank you. Is there anyone in the Latin American community who is in the audience today who wishes to make a statement at this particular time? If not, keeping in mind the time constraints we are under, I am going to ask for unanimous consent that we be permitted to pro- pound to you any questions that we did not have an opportunity to ask you, and ask by the same courtesy that you write to us if you want to expound on any question or if you want to raise any additional issues. 137 Hearing no objection that will be the order and I would like to express my thanks and the thanks of the delegation for the very splendid testimony and the very candid presentations that you have made. We are going to have a break now and I would urge that the members of the Latin American Civic Council remain here while we hear from the U.S. Civic Council. We will take about an eight-minute break now so that we can move right into the presentations of the United States Civic Councils. [Whereupon, at 11:35 a.m., the Subcommittee recessed.] [After a recess, the Subcommittee reconvened at 11:45 a.m., the Honorable Ralph H. Metcalfe presiding.] Mr. Metcalfe. The subcommittee will be in order. I guess my job, in addition to presiding, is being a good timekeeper and keep the time factor rolling along. We are pretty much on schedule. To be exact, we are about three minutes behind schedule. You heard the introductions of the Members of Congress, as well as the staff. I need not go through that. You heard my opening statement which applied to both of the Councils so we can proceed to get into the gutty issues with which we are confronted. We are most anxious to hear from you. We have before us a position paper and it has been brought to my attention that each one of you will address yourselves to part of this position paper. It is also my understanding that Mrs. Patricia Fulton will be the lead-off witness to proceed into the statement so that we can have the benefit from hearing from all of the Council presidents. STATEMENTS OF MRS. CHARLOTTE KENNEDY, PRESIDENT, CRIS- TOBAL-MARGARITA-BRAZOS HEIGHTS CIVIC COUNCIL; MR. HAROLD B. GREEN, JR., PRESIDENT, GAMBOA CIVIC COUNCIL; MRS. PATRICIA FULTON, PRESIDENT, PACIFIC CIVIC COUNCIL; MR. DALE WINDLE, PRESIDENT, GATUN CIVIC COUNCIL; AND DR. MELVIN BOREHAM, PRESIDENT, COCO SOLO-FRANCE FIELD CIVIC COUNCIL Mrs. Fulton. I will not be the first reader, but let me make a brief introduction. The representatives of the U.S. Councils in the Zone met together to plan a joint presentation so that you would not have to hear a lot of repetition on some of our concerns. We realize that as you look at our position paper that some of the language may sound strong, but we are at a point where we feel we have to be honest and we want to honestly portray the situation as we see it here living here. We realize we may be taking some personal risks in some of the statements we are making, but we feel we have to make you aware and put it into the record. Mrs. Charlotte Kennedy, President of the Cristobal-Margarita- Brazos Heights Civic Council, will be the first reader, followed by Mr. Harold Green of Gamboa. I will conclude and Mr. Mel Boreham 95-549 O - 77 - 10 138 from the Coco Solo-France Field Civic Council will have a brief statement. Mrs. Kennedy. Good morning. Mr. Metcalfe. Good morning, Mrs. Kennedy. It is good to see you again. Mrs. Kennedy. Well, undoubtedly we will repeat many of the things that Congressman Metcalfe has already heard but we felt with the new members we must go back perhaps to the beginning and give a background. This is our joint position paper. The Panama Canal was created by United States taxpayers' dollars, American ingenuity, engineering and medical expertise, and dedicated labor, transforming a sparsely-populated, fever-in- fested jungle into the eighth wonder of the world. In fact, the Republic of Panama owes its very existence to the United States and the Panama Canal. Anyone who has seen the Nicaraguan area which was once considered for a Canal route can readily imagine what Panama would look like today had there been no Canal built there. Likewise, Panama owes its former prosperity to the United States and the Canal Zone, not just from the annual railroad annuity, but also from wages paid to Panamanian employees in the Canal Zone, from purchases made by U.S. citizens and agencies of the Canal Zone, and from the millions of dollars in foreign aid given so lavishly out of United States taxpayers' money. The U.S. citizen work force in the Canal Zone is comprised largely of highly-skilled, dedicated, technical employees, who have left their homeland, not for service in a foreign country, but in the service of the United States Government under the flag of the United States. Their outstanding record of accomplishments in keeping the Canal running smoothly and efficiently has been due largely to their sense of pride in their work, their sense of loyalty to the United States, and their attitude of concern for their country's welfare. These people believe strongly that the Panama Canal cannot operate effectively or efficiently without a Canal Zone which is under the jurisdiction of the United States — with U.S. laws, courts, postal system, police and fire protection, and schools with U.S. curriculum and U.S. citizen teachers. We believe that the U.S. Government owes a strong legal and moral responsibility to these loyal employees to protect their job security, their lives, their property, and their families, while at the same time protecting the tremendous investment of taxpayers' money in the Canal. For the past three and one-half years, the U.S. Civic Councils in the Canal Zone have been preparing position papers and formal statements of community opinion for submission to Congressmen, Canal Zone officials. Department of Army representatives, treaty negotiators, and State Department officials. We have tried to main- tain an attitude of rationality, calmness, and sensible perspective on the subject of a new Panama Canal treaty with the Republic of Panama. One of the many points we have tried to make so often, so much so that we feel like "broken records," is that the U.S. citizen in the Canal Zone feels very apprehensive about living under the type of ''legal system" now in force in the Republic of Panama. We live next door to the Republic of Panama all year long; we use our eyes and ears to observe what is going on there and we are not 139 naive enough to believe that the Guardia Nacional, that mistreats fellow Panamanians with arbitrary beatings, imprisonment, expa- triation and murder, is going to give special treatment to those ''hated colonialist gringoes" who have finally come under their jurisdiction. This attitude of hostility is encouraged and developed by the government-controlled news media in the Republic of Pa- nama. The actions of the Panamanian government during the past year and a half have done nothing to sell the U.S. employee in the Canal Zone on the idea of living under Panamanian jurisdiction. Let us cite a few examples: 1. In January, 1976, a group of Panamanian businessmen and professionals were exiled, contrary to the Panamanian constitution, for their opposition to the Torrijos regime. 2. The student riots in Panama City in September, 1976, were clumsily handled by the Guardia Nacional, so much so that the disorder continued almost daily for a week and a half. When the Guardia finally took decisive action, it was brutal. 3. The October bombings in the Canal Zone have been credited to members of the G-2 of the Guardia Nacional, although members of the U. S. Embassy speculated informally that Bill Drummond might have bombed his own cars and participated in bombings at other sites in order to gain sympathy for his anti-treaty stand. 4. An Air Panama pilot, officially charged with possession of bombs to be used against the Panamanian government, told people at Paitilla Medical Center that the bomb that exploded in his car was tossed in there by a passing G-2 car. According to the Panama- nian government's ''official version," the man's wife was holding a bomb in her lap — a somewhat incredible tale — when the bomb exploded, injuring her seriously. Incidentally, his wife was sen- tenced to five years in prison. 5. Guardia Nacional escorted groups of students into the Canal Zone January 9, 1977, where American fiags were burned and Panamanian flags were raised. This last ritual seemed somewhat unnecessary because Panamanian flags are already flying in the Canal Zone. 6. William Drummond, while passing through Tocumen Airport on February 11, 1977, en route to Washington on labor union business, was detained by G-2 agents and questioned for about three hours in the downtown Panama City office. When he tried to board another plane the following day, he was detained for 15 minutes at the foot of the boarding ramp, and seven friends who accompanied him to the airport were also detained and questioned because one of them took pictures of Mr. Drummond being stopped by G-2 agents. The film was confiscated by the G-2. It seems inconsistent with the stated refusal of our government to deal with countries who have violated human rights that any negotiations should be carried on with a government which is in power illegally, and which has a record of frequent violation of human rights. The Torrijos dictatorship has used extreme repres- sion against political, professional, business, student and labor groups. The expatriation of what is estimated to be about 1300 Panamanians and the murder of some 500 persons in a country of only 1,700,000 inhabitants would compare to 168,000 expatriations 140 and 65,000 murders in the United States. Definitive, authoritative figures on expatriations and political murders are difficult to obtain in Panama because of government secrecy and suppression of infor- mation which the government does not want its people to have. What exists now in the Canal Zone, after many attempts on our part to send out warning signals and indications of problems to come, is a **seige mentality" and crisis atmosphere. Now that one of the Civic Council presidents whose signature appears at the conclu- sion of this paper — Harold Green of Gamboa — has had recent experience with arbitrary detention, arrest, interrogation and search in the Republic, we are having real difficulty in maintaining an attitude of composure and calm rationality. In short, our people have told us that they are more rigidly opposed than ever to living under Panamanian jurisdiction. The list of 15 assurances, recently released by Governor Harold R. Parfitt, spelled out for them the cold, hard reality that Panamanian law would go into effect when the treaty was inaugurated, and many, many of our people now tell us that "the day that the Canal Zone police go, we go," and also, more alarmingly, **when the U.S. workers see the day getting closer when jurisdiction will be handed to Panama, you can expect to see the Canal shut down." Last year. Dr. Richard Cheville addressed your committee not long after the March sick-out, and he explained in his testimony some of the factors that led us to the closing of the Panama Canal. Morale at that time was extremely low; this year we have to say honestly that our people are so demoralized that they are ready to give up and quit — a shutdown of the Canal, if it occurs, will not happen over a labor issue. It will result from apprehensive employ- ees, who in their fear for their physical security, will simply leave their jobsites, go home and pack their suitcases for repatriation. We do not say this lightly; we do not say it as a threat. But we must make the honest observation that our people feel so thoroughly discouraged and so exhausted after several years' worth of worry and insecurity — with nothing much to look forward to — that it would not take much to get some of them to join a job action. I will relinquish my place now to Mr. Green, the Bud Green who was held up at the Tocumen Airport. Mr. Green. Good morning. In contrast to our position as year- round residents and as elected representatives of U.S. citizens living in the Panama Canal communities, the treaty negotiators and State Department officials have little at stake themselves personally, other than to successfully negotiate a treaty which will, in their minds, ease hemispheric tensions and get rid of chronic problems in relations with Panama. When they finish their assignment, they will move on to other missions, leaving us to live with what they have arranged in treaty form. Generally, the treaty negotiators come to Panama for short periods of time, followed by journalists who become experts after a 3-day tour that includes standard briefings by the Panamanian and Canal Zone governments. These negotiators for the most part stay in isolation on the Island of Contadora, and when they have consented to meet with Canal Zone labor and civic representatives, they have said relatively nothing of any significance on the treaty issue. We sincerely resent the fact 141 that our services and the future security of our nation are being negotiated under a cloak-and-dagger atmosphere, particularly since the secrecy is unilateral. Secrecy, in recent years, has been closely linked with dishonest, illegl or shady dealings. We in the Canal Zone are hard pressed to accurately define the secrecy attached to the Panama Canal negoti- ations. Imagine our chagrin to daily read in the Panama papers that a Panamanian Government spokesman is briefing Panama- nian students, professional, business or labor groups on the "progress of the negotiations." And the presidents of Costa Rica, Colombia, and Venezuela seemed to be briefed regularly by General Torrijos about treaty matters. Does the U.S. State Department believe that the American people are not mature enough to prop- erly accept and assimilate such highly important information? Let us make clear that we are American citizens deeply con- cerned with the present and future well-being of our nation. Our opinions on what the U.S. has at stake in the negotiation of a new Canal treaty are also affected by our conversations with Panama- nian friends, our reading of Spanish-language and English-language newspapers in Panama, and our understanding of the behavioral traits of the Panamanian government — something which one does not arrive at overnight or even in three days. Because of the present situation in the Republic of Panama, many of us do not ''cross the border" as often, as freely, or even as nonchalantly as we used to. Fear, apprehension, and deep concern for our personal safty brought about by a succession of events in Panama, have given us an increasing '*locked-in" feeling in the Canal Zone. When Panamanians are deported, or arrested, tortured and even killed for having dissident opinions, and when even our own people are subject to arrest in Tocumen Airport, in violation of existing treaty agreements — the average U.S. citizen in the Canal Zone is not at all enthusiastic about arbitrarily being subjected to the legal jurisdic- tion of such a repressive government. As an additional item of evidence, we have had numerous conversations with many Panama- nians that you will never be able to meet. Our impression from these conversations is that when the Panamanian government officials speak today, they are not speaking for all the people. Let us cite a statement made recently by an educated businesswoman from Panama City. Speaking to a Civic Council president informally, she said, 'The United States is a world leader and so is the Soviet Union. But the United States has the advantage of liberty and freedom. Yet your country is doing nothing to help promote the spread of liberty in Latin America today. I understand that your government cannot interfere in our internal affairs, but your government could with- hold foreign aid and could stop giving military assistance to our government. Our people are growing in their resentment of the United States Government because they see your government sell- ing weapons, armored cars, and other equipment to this govern- ment that oppresses us." The Panamanian people seem to be overtly silent because they have no effective means that they can see with which to fight back. However, the ever-increasing opposition to the dictatorial govern- 142 ment of Omar Torrijos became glaringly evident during the past September riots in Panama. Rumors have been rampant for months in the Canal Zone and Panama that more anti-government riots may be imminent in the months of April and May. What effect does all this have on the operation of the Canal? Right now it is having a disastrous effect on the quality of work being performed because workers are ''uptight" constantly about physical and economic security. The pride in working on the Pa- nama Canal that has been part of our historical heritage here since the Canal's construction is now giving way to constant preoccupa- tion with one's personal welfare. The recent arrests of U.S. citizens at Tocumen Airport was not lightly regarded by our people, many of whom wonder about their own safety in passing through this airport. The Panamanian government has not yet responded to the offi- cial protest concerning their violation of the Air Transport Service Agreement of 1949. Comments in the Panamanian press were that the Panamanian government did not like the agreement, a senti- ment that does not augur well for any commitments made in a new treaty. The Panamanian government could decide, sooner or later, that they ''don't like the agreement" again. On the subject of Tocumen Airport, let us add that our requests for use of Howard Air Force Base as the point of air departure and arrival from the Canal Zone were denied because "one arrest does not justify the civilian use of this military air terminal." U.S. residents who one year ago thought William Drummond was an eccentric who made his own problems, have been so jarred by events of the past year that now they identify fully with what happened to him at Tocumen Airport. They reason thusly: "If it can happen to Bill Drummond, then perhaps it can happen to me." Our people are now asking us, "How many arrests are needed for someone in our federal government to take steps to insure our protection in travel by air to and from the Canal Zone." Turning now to the subject of employee status under a new treaty with Panama, we would like to respond to the recent list of 15 items which the U.S. presumably proposes to submit at the negotiating table. In spite of the fact that the Panamanian government has said that this list of "assurances" would not be acceptable, we wish to let you know the reaction from the U.S. community in the Canal Zone. Assurances of U.S.-provided schooling and medical care, adequate housing, duty-free import and purchasing privileges and exemption from Panamanian income tax were good news to us, as you may be well aware. The language regarding job assurances was somewhat vague and left us wondering if we would be given help or if we would not. The assurances seem to promise only what we already have: "all eligible employees are guaranteed by current regulation reduction-in-force and reassignment rights, transfer of function rights, and discontinued service retirement following involuntary separation." We were also told that "Civil Service Commission approval will be sought to provide any present U.S. citizen employee requesting such assistance with priority placement consideration for appropri- ate vacancies in federal government agencies." This is still vague 143 and uncertain, and our people have had about all they can tolerate of uncertainty. j The irony of the list of 15 assurances is that, in spite of advan- ; tages which the U.S. citizen who might consider remaining here will have over the locally-hired Panamanian citizen employee, our peo- ple have such strong objections to the fifth item in that list, that they have little interest in the other somewhat positive assurances. The item which caught the exclusive attention of the U.S. commu- nity reads like this: "In connection with offenses arising from acts I of omission punishable under the laws of the Republic of Panama, I tlnited States citizen employees and their dependents will be enti- M tied to specific procedural guarantees, such as prompt and speedy i trial, specific charges, cross-examination of witnesses and legal i representation of choice." Disregarding the fact that Panamanian government officials have ; announced in their local newspapers that they would never allow U.S. employees in the Canal enterprise to have a ''status of forces agreement", type of an agreement such as the U.S. military will have, and assuming for the sake of argument that the Panamanian negotiators agree to this assurance as part of the new treaty, who I will guarantee that the Panam.anian government will consistently ! comply with the request to give U.S. citizen employees these "proce- i dural guarantees"? After reviewing the list of assurances, we would like to hear something more specific and concrete, in language that we can understand, concerning priority transfers to government jobs in the United States. In addition, we would like to express concern for two particular job categories: teachers and policemen. At this point, teachers have no transfer rights from the Canal Zone into the U.S. Civil Service system, other than for jobs at Indian reservations. They have worked faithfully and well in educating our children, and we are distressed that they are left "out on a limb" when it comes to job i] transfers. Those who do not chose to participate in the DOD school ' system which will probably go into effect down here should be given first priority for employment in the U.S. and assistance in obtaining such employment. The men and women of the Canal Zone Police Division are among those living under a "death sentence" because treaty negotiators have made it quite clear that law enforcement functions of the present Canal Zone Government will cease within 3 years after the new treaty goes into effect. The morale in this particular division continues daily at an all-time low because these employees only know that they will be out of a job soon; they know nothing about any future employment that wil allow them to provide for their families. In general, our people were appreciative of the attempt to give them some information about their status under a new treaty, even if that list of assurances is rejected by the Panamanian government. Nevertheless, our Personnel Bureau continues to have difficulty in recruiting pilots, doctors, nurses, marine engineers, electricians, tugboat masters, and other needed workers for the Canal enter- prise. Our constituents tell us that June will witness another mass exodus from the Canal Zone, further magnifying the task of our job recruitment specialists. 144 I will here relinquish to Pat Fulton. Mrs. Fulton. During the past 3 to 4 years, while job security has been a major concern for our people, they have been receiving an "education" from the State Department concerning the treaty. In briefings, newspaper articles, and informal discussions, the State Department officials make clear these basic premises for their argument that a new treaty is needed: 1. A Canal Zone is not necessary for the successful operation of the Canal. They tell us that we wouldn't want to live in the Canal Zone if Panama did not get the treaty it desires. 2. The countries of Latin America give full support to Panama's claims for sovereignty over the Canal Zone and eventual control of the Canal operation. 3. The turnover of the Canal to Panama is in the best interests of the United States because not to do so would possibly involve our country in another Vietnam-style guerrilla war. 4. Panama has a sincere interest in keeping the Canal open and would not do anything to jeopardize the efficient operation of the Canal. 5. The Canal Zone is an anachronism; it is a source of irritation. Once the U.S. citizens are scattered throughout Panama City and Colon, they will no longer be identified as "Zonians", thus easing tensions and friction between the U.S. and Panama. 6. The economic growth of Panama depends on acquiring the lands in the Canal Zone so that Panama City and Colon can expand their business interests. 7. The denial of basic human rights within the Republic of Panama is not a matter that needs to be brought into the treaty negotiations. After all, Panama is one of the "developing countries of the world," and such behavior is normal for such countries. 8. The State Department would not negotiate a treaty which the U.S. Congress would not ratify. The above concepts might be plausible to someone who has not lived here, to someone who has little or no dealings with the Panamanian government and its officials. They make the negotia- tion of a new treaty with Panama under the Kissinger-Tack concep- tual principles as the most logical course to follow. Permit us to provide some responses to these concepts we have listed. 1. When the Canal Zone-U.S. -based legal system ceases to exist, many, if not all U.S. emloyees, will leave because they prefer to work and live under an orderly system of laws that guarantees them justice and fair play. They are becoming increasingly resistant to the thought of living under the Panamanian legal system as it is now administered. 2. The countries of Latin America say one thing in public and another privately. In the newspapers they pledge full support for Panama's claims to the Canal. In private, to people such as former Under Secretary of State William Rogers, they say that they are satisfied with the course that the U.S. is taking in the Canal treaty negotiatins. From observation of the political behavior and egocentrism of Latin American governments, one can safely say that Omar Torrijos could not depend on his Latin American neighbors for 145 monetary or military support in an open conflict with the United States. Those other countries wish to preserve their own ties to the United States in foreign aid allotments and commercial ventures. They would not sacrifice their own interests for the sake of Torrijos' "just aspirations" concerning the Canal. Rhetorical support is about all that General Torrijos can expect from Central and South America. 3. Turning over the Canal to prevent "guerrilla warfare" is not in the best interests of the United States because: a. construction of enough warships to provide a "two-ocean navy" would be necessary in case Panama became whimsical in permitting us access to the Canal for military vessels. The extra cost in fuel for sending these ships around the tip of South America would be astronomical. b. The Moscow-Havana axis has been casting lustful eyes for a long time toward our Canal as well as at other straits and waterways of the world. Panama does not have the military strength [even with the armored cars now in their possession] to withstand an assault from any country that would choose to invade and occupy it. The Panamanian people are not "fighters" by tradi- tion; they have never fought a war of liberation. The average campesino reasons in this way: "Why should I get myself killed for the sake of a dictator? What will it gain me or my family? Abso- lutely nothing. Therefore, I will simply adjust to whoever is in power. One ruler is as bad as another." c. The flow of Alaskan oil through the Panama Canal en route to eastern parts in the United States will be in serious jeopardy when Panama has control over access to the Canal and over the setting of tolls. d. Our first line of defense in the western hemisphere would suddenly become Harlingen or McAllen, Texas [or perhaps Key West, Florida.] e. The threat of "guerrilla warfare" amounts to nothing more than an attempt at political "blackmail" and appears to be contra- dictory in nature, based on the actions of the State Department. How valid is the threat if the State Department permits the sale and assists in the movement of armed personnel carriers to the Panamanian government? This military equipment was furnished in two installments, the first in October, 1976, and the second on March 5, 1977. This second installment, consisting of 12 armored vehicles, was delivered under Canal Zone poice escort, to the Repub- lic of Panama. What can justify the sale of military equipment to a potential enemy? How does one explain this situation to a U.S. soldier who may some day face his own death at the hands of an enemy who is using equipment built in the United States and delivered with the help of our own government officials? [One rather weak explanation from the U.S. Embassy in Panama is, "Well, if they don't buy from us, they'll buy from someone else. It's better that U.S. industry gets the money and we can control the supply of replacement parts."] 4. The Panamanian government is not noted for rational, logical behavior, nor for extensive attention toward preventive mainte- nance of government equipment. At this point, the Panamanian 146 government, nearly bankrupt, needs money so desperately that we agree they have a sincere interest in keeping the Canal open and operating efficiently. We further believe that the Canal will remain open and operating efficiently even if the Pananamian government does not gain con- trol of the Canal and the Canal Zone. Panama presently derives about one-third of its national income [$256 million in 1976] from Canal sources and they are not about to jeopardize that income by foolishly attempting to sabotage the Canal. Any terrorist or guerilla type action, if at all, will be aimed at targets other than the Canal. In short, U.S. taxpayers are being required to sacrifice their tax dollars, land and national security in order to protect the invest- ment of multi-national business corporations. One of the differences between U.S. control and Panamanian control of the Canal and Canal Zone is the anticipated exorbitant increase in tolls which Panama would levy. Any such increase would seriously jeopardize the economic health of the Canal and increase the cost of products in countries that can ill afford such an increase. Sabotage and toll increases will hurt most of these Central and South American countries who are supposedly solidly behind the ''just aspirations" of General Torrijos. The lackadaisical attitude toward repairs and maintenance would contribute to the mechanical and structural breakdown of the Canal and appurtenances [unless the United States agreed to con- tinue supplying parts and maintenance indefinitely.] 5. The "gringo" as he is often called here in Panama, will continue to receive harassment, whether he lives in Panama or the present Canal Zone. The United States has been a rather conve- nient whipping boy for the Republic of Panama for years and years. Criticism of the U.S. has always been used to distract the Panama- nian's attention from the incompetence, graft, corruption, and poor judgment of his own government. Besides, the average Panamanian [when he permits himself to talk freely] does not want a treaty signed under the regime of Omar Torrijos. Such a treaty would reinforce the already crushing power of the Torrijos government on the Panamanian people. 6. The economic growth of Panama will need more than a Canal to restore it to health. The repressive atmosphere has inhibited consumers from visiting stores and businesses, it has inhibited investors from putting their money to work in Panamanian enter- prises. The acquisition of Canal Zone lands for use by Panamanian commercial interests still requires the intelligent use and exploita- tion of these lands by competent businessmen. Such people are not the ones in control in the Panamanian government today. The ones in power are miitary men without adequate training in economics and business management. At this point we will not even attempt to explore the plight of the businessman in Panama who is weighed down by a pyramid of government taxes and fees, a labor code full of headaches for everyone, and abundant government red tape necessary in order to operate a business in the Republic. 7. The denial of basic human rights within the Republic of Panama is a matter that should be considered in the treaty negotia- tions. President Carter has expressed repeated interest in the 147 matter of human rights. If our country is to participate in a metaphorical ''marriage" by means of a treaty with another coun- try, we should know just who that "spouse" is. Denial of human rights is bound to make further problems for Canal employees later on, no matter what nationality they are. Rather than taking an amoral stance, our country should apply its influence on the Panamanian Government, to the extent that U.S. citizens [who do come under the legitimate concern of our Federal Government] will not be permitted to live under such repression. We cannot rightfully interfere in the domestic policies of another nation, but we can let them know that they wil not receive what they desperately want from us unless they make some changes in that policy. 8. The State Department is negotiating a treaty which it is willing to ratify. They make the assumption that they know what is in the best interest of the United States" and that all other opinions are to be considered ill-informed, unenlightened and out of step with modern times. In past years, civic leaders from the Canal Zone have presented to you concerns they had about day-to-day items such as health care, commissaries, substandard housing, and schools. We continue to have such concerns, but in an important hearing such as this, when your time is at a premium, we emphasize that our concern this year is the survival of the Canal and the physical well-being of the Canal operation. U.S. citizens in the Canal Zone have been greatly disturbed in the past year with the direction in which the treaty negotiations seem to be going. They tend to feel powerless in the writing of a major agreement between two countries, an agreement which will have far-reaching effects on these workers as well as on the United States as a nation. Because of the political unrest in Panama today as opposition to the Torrijos regime mounts because of economic and political prob- lems, we know we live and work here with a certain amount of risk. But at the same time we are concerned with the implications that the treaty being negotiated with Omar Torrijos will have on the United States. The behavior of the Panamanian Government in the past year should be testimony enough in itself to give our Senators and Representatives some serious reservations about the wisdom of a treaty with a government that runs roughshod over its citizens' human rights and that drains the national treasury to supply a comfortable life style for numerous high-ranking officials. A case in point is the current trip to Libya, during which General Torrijos and 49 other dignitaries will expend govenment funds while their nation is on the threshold of bankruptcy and the people at home are exhorted to make "sacrifices" for the national good. While all these things have been going on in Panama, State Department officials have assumed that the Panama Canal worker would stay in his place and patiently await the verdict on the treaty. They can no longer make that assumption safely. If the U.S. Government wishes the Canal to continue operating efficiently for world commerce, it will need to supply employees who are willing to work under the present tense and uncertain conditions. The U.S. 148 Government may fmd them, but with some difficulty and probably at great cost in financial enticements. It would seem to make more sense to respond to the needs of the current work force and likewise to avoid any haste in ratifying a treaty with Panama that promises to bring even more headaches in the future. For ourselves as U.S. citizens living and working thousands of miles from our home land, we can say, 'Tack us up tomorrow. We're ready to go." But for the sake of U.S. commerce and of U.S. national interests in general in the Western Hemisphere, we urge you to examine the proposed treaty [whenever it is announced] in minute detail. We urge you to visit here for more than three days, to observe the situation with your own eyes and not to depend solely on briefings by U.S. or Panamanian Government officials. The new treaty with Panama will have long-range repercussions that coming generations will have to live w^ith. We urge you not to ratify a new treaty solely because the State Department says that a treaty is the cure-all to problems with Panama. The Russia-Cuba axis and the American electorate are waiting to see which way the treaty goes. A hasty decision on the part of our Congressmen without giving deep and thoughtful study to the question would please the former and infuriate the latter. And now Dr. Mel Boreham would like to make a statement for Coco Solo. Mr. Boreham. Members of the subcommittee, I have a letter presented to the Honorable Governor Harold Parfitt concerning some of the points, the assurances that were given by the negotia- tors, on their stand in our negotiation with Panama. I think one of the things the subcommittee must realize is that the Canal Zone represents a slice of Americana. We are pretty much, I think, similar, analogous to a small town in the Midwest or, say, one of the company-run towns of Montana with a population of 15,000. If you were to go to one of these areas in the United States and tell them that next year they were going to come under Brazilian jurisdiction, with Brazilian police and courts and so forth, I think there would be a very great furor and people would naturally leave that town and possibly go elsewhere. I think that most of the U.S. employees of the United States Government have decided that there will be a new treaty between Panama and the United States. Unfortunately, many of our U.S. citizen employees have a feeling that they are the expendable persons in this regard, to this particular diplomatic solution with the current Panama question. This is especially true with regard to living under total Panama- nian jurisdiction. I must express my great concern that many, if not most, U.S. citizens and employees would choose to return to the United States should that be a part of any treaty between the United States and Panama. Twenty years is a short time, as the reported date has been talked about for the turnover to be around the year 2000. I think the only way that such a mass, mass exodus may be stemmed is to allow for the U.S. citizen housing and work areas of the Canal be retained under the security of the U.S. Armed Forces. 149 I believe that this condition must be considered as a minimum for the continued presence of experienced — of an experienced Canal Zone work force throughout the transition period of not 3 years but possibly of 20 to 25 years. Should such security areas not be set up for the U.S. citizen worker, those responsible for such unrealistic living conditions must accept the consequences of the possible ineffective functioning of the Panama Canal and its invaluable service to worldwide shipping and commerce. That is my prepared statement. I think that this is really and truly a minimum thing. All of the people that I have talked to in my town site and other town sites across the isthmus have stated to me that should jurisidiction go to Panama, the turnover of police and courts and so forth, that they would essentially pack up and leave tomorrow. I think this is essentially a reiteration of what was given in the other position paper, but I just wanted to stress it in these particu- lar terms. Thank you very much. Mr. Metcalfe. Thank you, Dr. Boreham. We have listened to your presentation. First, let me ask unani- mous consent to enter the letter that Dr. Boreham had submitted to us into the record. Not hearing any objection, it will be so ordered. [The letter referred to follows:] 150 coco solo-france field civic council ' W^*";'^ POST OFFICE BOX 1 ' r ~ COCO SOLO, CANAL ZONE March 23, 1977 The Hon. Harold R. Parfitt Governor of the Canal Zone ' : Balboa Heights, Canal Zone Through: Civic Council Staff Officer P. 0. Box M Balboa Heights, Canal Zone Dear Governor Parfitt: On the behalf of the Coco Solo-France Field Civic Council and the community we represent, I wish to thank you for your genuine concern for employees of the Canal Zone and their dependents. The list of assurances released this past week is an excellent step toward relieving some of the anxiety built up by the on-going neg- otiations for a new U.S.- Panama treaty A special meeting of our Council was held on March 22 in order to discuss each of the 15 points of the list of assurances. I believe that there is general acceptance of these points by most U.S. citizen employees. It is realized that the wording is, out of necessity, a bit vague and generalized, thus leaving certain questions unanswered. I shall list below some of these questions under the number heading of each point on which our council members expressed concern: Point 1. With regard to medical care, will equivalent medical care facilities be located on both sides of the Isthmus? Will there be an Atlantic side hospital? Point 2. What type of housing will be considered "adequate" and what rental rates will be considered "reasonable" relative to our present situation? Will water and electricity be purchased through Panama at at their much higher rates? _ Point 3. Will the military service facilities include gasoline stations, food commissaries, auto repair facilities and APO postal service? Will there be special rates for automobile license plates? Point 5, How will procedural guarantees be enforced considering the recent airport detainments of U.S. citizens? Will there be any special liaison office to handle judicial appeals or complaints? Point 6. Will there be demands that "dual nationals" be required to have cedulas, Paz y Salvos, Panamanian passports, etc.? Will taxes and duties be levied against such persons? What type of documents will be required by these U.S. citizens for travel to and from Panama through Tocumen and 151 border check points? Point 10. VJill any special "early retirement" plan be offered such as was recommended during the negotiations of new treaty in 1967? This plan would have given one years extra credit for each five years service and would have allowed reduced annuity retirement after a total of 15 years service credit. Will employees who find post-treaty conditions not acceptable, be allowed to retire early under such a plan on a "vol- untary" basis? Point 11. Should a U.S. Government job freeze be in effect, could the Civic Service Commission be requested to provide a waiver to Canal Zone employees requesting such assistance in order to transfer into other U.S. Government Agencies? Should Canal employees be placed under the Department of Defense, would the current mandatory 5 year rotation back to the U.S. be in effect for such employees? Point 15. Will the current leave structure be changed? Differential? As an employee benefit, will the railroad continue to operate as part of the Canal entity under U.S. control, rates and fares? I hope that you will find the above questions of interest with re- gard to the request you made for comments on the list of assurances. We realize that many of the questions listed above cannot be answered now and will have wait until the actual treaty text is available for study. These are just some of the concerns the coimunity has at the present time. Sincerely yours. Dr. Melvin M. Boreham, President Coco Solo-France Field Civic Council Mr. Metcalfe. I made a statement in the beginning of these hearings in this building, in terms of my association over a period of years, including recent years, with the civic councils. I feel as though I have a good appreciation of the attitudes of both the civic councils groups. I am reminded that in the last hearing when I came down with the Committe on Appropriations, Mrs. Pat Fulton was kind enough to invite, among others, members of our delegation to her home and we found the visit very enlightening. So, therefore, I will not again attempt to monopolize the questions because I certainly want to yield as quickly as possible to the new members so that they will have their full opportunity, as well as the staff, to ask some questions. However, I would like to ask a few very brief questions. The first one is: Do you think that you have been kept — have been kept adequately informed of the U.S. treaty negotiations? I think you addressed yourself to that, and you felt as though you had not been given an adequate reception. Mrs. Fulton. We only know what the Miami Herald tells us. And the Panama City Star and Herald. Mr. Metcalfe. What would you recommend be done to keep you better informed. What is your recommendation since you are not being informed? 152 Mr. Green. I believe we should be entitled to the same thing that is presented on the other side of the fence. If a Panamanian statesman can brief Panamanian professionals, students and so forth on the subject of the treaty, I believe our statesmen should be likewise briefing us. Mr. Metcalfe. Has there been any reduction in non-U. S. teachers in the school system as of now? Mrs. Kennedy. I don't believe so. Mr. Metcalfe. I interpret that as meaning no appreciable reduc- tion; is that right? Now would you comment on the morale of the U.S. citizens? This is probably redundant because I think the whole statement that you have given is on the questions that I am asking and I believe that you have satisfactorily indicated what you conceive is the morale of the United States citizens living in the Zone. May I ask, what can be done to improve this low morale, assum- ing, of course, that I understood you to say the morale is very low. Mr. Green. In that particular instance, the U.S. citizen ought to be given positive assurances — not proposed assurances, but positive assurances. The way we look at this at this particular point is, our negotiators are basically taking a community, that is basically a U.S. community, and placing it under the jurisdiction of a foreign government. Even under our own Constitution I don't believe they have the authority to do this. Therefore, there has to be some means to get the citizen in the Canal Zone that does not desire to remain under the jurisdiction of this particular government out of the Canal Zone. Mrs. Fulton. Let me comment on that also. There are situations in Panama which are not related specifically to the Canal Zone. We feel very vulnerable in that sometimes wh^n there are government problems the government leaders will divert students or if there are already disorders they will send it into the Canal Zone and use it as a distraction. Plus, we are worried about what happens when Panama gets the treaty, because the Panamanians in power have a lot of animosity saved up. It is a paranoid fear, I admit this. But we have had an accumulation of tensions. It has not come over a weekend or even a month. It has been accumulating. So, one, when Panama gets the treaty, there are fears of what are they going to do to us. They have been waiting. Okay. If Panama doesn't get the treaty, we are told, ''Watch it, you are going to get it," you know. 'They are going to take it out on you" because their patience has come to an end. We have the situation at the airport which to some may seem to be an isolated example and people may wonder why we are making a big point of it but with the present emotional condition of the average worker here, you see, we are worried about going out to the airport. Now people are talking about taking friends out with them, watching to see if they get on the plane, which may sound a little silly. We've assumed for years that a Canal Zone resident can go to Tocumen, and can come back with no problems. But now our people have doubts, and that lingering worry. Taking pictures. After the recent arrests, it seems that we can't even take pictures anymore. A lot of things have accumulated and we are now in the Canal Zone worried about our jobs, and about what's going on in Panama, 153 and how it will affect us. If the American in the Canal Zone had been able to look at Panama in the last couple years and say it's steady, it's even, it's calm, with no problems, then I don't think you would have this morale problem today. But there have been some disturbing things going on and our people react to these events. This is next door. Some of them have relatives who live over there. Some of them may have property, and perhaps intend to be retired there. So there is some concern for our well-being. Mr. Metcalfe. Mrs. Fulton, of course, you statement was very clear and it just enunciated with a great deal of clarity your feelings, but I am concerned about what Mr. Harold Green has given as a response to the question as to what can be done in order to build morale. Of course, your response was that you needed to know and have the assurances. Now I don't think anyone has those assurances, can have those asurances, in light of the ongoing treaty negotiations, which seems to be contradictory to a realistic ap- proach, and this disturbs me as the chairman and one of the members of the committee. I will now yield to the genteman from New York, Mr. Zeferetti, for any questions that he may have. Mr. Zeferetti. Thank you, Mr. Chairman, and may I thank you for a litany of the history of what is going on. I think it is very important and it is excellent testimony. We are going to be here for 3 days. I don't think we are going to solve all the problems that are here, but I don't want you to feel we would be negligent in our observations or our appraisals of what is going on. I feel very strongly about the need for some sort of communica- tion. However, there seems to be a gap in information channels. The Governor this morning made reference to that and talked about a large group of people suddenly leaving and going back for the first time and the large numbers that are there and they are prevalent, and I think what you expressed just a minute ago to the chairman, talking about the inability to know what tomorrow might bring, is of great concern to all of us. It should be, and I think maybe these are avenues that we could work towards getting some solution anyway in a short period of time. You seem in your testimony also to relate specifically to the Embassy statements and the State Department statements and yet you are not that happy with the kind of responses you have been getting from both agencies. Why don't you go a little bit further into that and give us some of the experiences? Mrs. Fulton. I am trying to understand the question. Mr. Zeferettl In other words, you talk about getting responses from the State Department answering some of the problems you bring forth and the kind of responses you get. The same thing with the Embassy where you went and talked about the airport incident and when you talk about the Canal and what the needs are, the kind of response you get. Do you feel there is a lack of understanding there also, or is it just a political type of motivation rather than the consideration because of the employees? Mrs. Fulton. Well, let me give some credit where credit is due to be perfectly fair. For the past year and a half there has been an 95-549 - 77 - 11 154 attempt by some people in the Embassy specifically to get to know the Canal Zone personnel. It has not been overwhelmingly success- ful, but some have done it, and have made opportunities available to have Congressmen here. I have had some discussions to, one, find out what their thinking is and, two, to share some thoughts from our side. They look at the matter in a broad spectrum. And when we bring up problems that we see specifically in Panama, we're interested because we are living in this, we are going to be part of the neighborhood shortly. I am told "Well, no, no, no, it is not as bad as it is in Chile, Brazil, Mozambique, wherever." My argument is, I don't care what they do in Argentina or Chile. The Canal is here." So there is a way of thinking. I think they are beginning to listen a little, but they've got the problem of writing the treaty and we don't. So we're told we've got to be realistic and that this is all going to work out. We say trust us, we live here. Embassy people come and go, they don't live here for 30 years, and some are glad to go when they go. And we're going to be stuck with what they negoti- ate. Our meetings with Ambassador Bunker have been frightfully disappointing. Perhaps he can't say anything, but it's disappointing to come to a meeting for some crumb of information, and then to receive double-talk. In response to these vague phrases such as, "you'll get taken care of," we're becoming rather cynical. Mr. Zeferetti. Well, I think we must be fair to the other side, the Panamanian people; they haven't had communication either. Mrs. Fulton. Could I make a suggestion? This has been brought up maybe informally in testimony at other times, I don't know, but our means of communication in the Canal Zone is limited to Southern Command, what they put out to their people, the South- ern Command TV station, which is making it more and more clear that first there is the military, and then we come along after. We have the Spillway, which for economic reasons only, has limited space and perhaps for policy reasons cannot go into in-depth report- ing. They only give us information on the Company. So we depend on what the Miami Herald chooses to put in its paper, what the local papers choose to tell us. I started buying them just to find out what they are saying. What we need, and I am not talking about a chatty, gossipy sort of little newssheet, but we need something here for an honest open communication of facts, materials, data, argu- ments and so forth. It is not here; we don't have it. So rumors go rampant. '1 saw so-and-so doing so-and-so," or "my husband at work found out thus and so" — and you know what happens to rumors, they get out of proportion. We trade gossip, we trade rumors, we speculate — sometimes fears and worries build up that are totally groundless. The Governor was very effective in installing a hot line. We are very grateful for this. Now you can call the phone number and ask if there is truth to a particular rumor. But the answers to many of the questions are not always published regularly, so people say "I had this question too; what is the answer?" We have a need for very simply some kind of a newspaper. And I know there is the economic issue and so forth, but if you talk about communications you are 155 only told things officially, you know, through company memos or through the Spillway. Mr. Zeferetti. Have formal recommendations been made to our Embassy or the State Department or communicated to the negotia- tors as to what you want in a treaty arrangement. Have you recommended something? J Mr. BoREHAM. I think looking at this completely realistically, you can have any kind of treaty you want, unless you have secure areas for people to live and work, you don't have them. I think it is as I simple as that. Mr. Zeferetti. Have you taken the time out to do this formally? 3^ Have you put this down where you say "These are the things that J should come forward if the result is a new treaty. I Mr. BoREHAM. Your subcommittee can generate legislation, is ^ that correct? Mr. Zeferetti. Yes, it can. : Mr. BoREHAM. What I would like to see is something arising from i your subcommittee that would guarantee the employees unilater- ; ally, from the United States Government, the Civil Service ' Comission, certain written guarantees as far as job placement, as far as guarantees about work, not only after the treaty, but for a certain period prior to the treaty or after the treaty comes out. This is something that would be very, very, beneficial for the employee. ' He would know in a way that these are assurances by the Civil Service Commission, by the United States Government, and he ; would be guaranteed that he could plan his life. ' . Mr. Zeferetti. There are laws already in place. I Mr. BoREHAM. Yes, there are. Mr. Zeferetti. What I am saying to you, sir, is that to help us, and give us the educational background of your experiences here. In order to negate some of those fears, a formal presentation could be made to the chairman of the committee before we can address ourselves to anything like that, should we welcome that kind of thing. Mr. BoREHAM. That could be done right now, and maybe work on them. Mrs. Fulton. We have brought them informally. Mr. Zeferetti. I would like to see some of these things formally in place. Mr. BoREHAM. Some of these things shojald be expressed by your subcommittee through the congress to the State Department as far as minimum conditions the employees will accept in a treaty. Mrs. Kennedy. And we have presented statements from our civic councils to the negotiators through Ambassador Bunker on several occasions, and they must have a very large file in the wastebasket now becase we have never heard from any of this. 'Tather knows best." Mrs. Fulton. When we bring up the problem of sovereignty, it's a very emotional issue, we are told, ''Look, so many presidents have supported this, it is part of the package, and agreements, and it is settled. So the feeling is, that in the first place, don't even mention it. And so now we are just frankly saying, okay, keep it in place and our people are going out of place and somebody has got to run the Canal. 156 Mr. BoREHAM. The Canal is run by human beings. We have no clout with the negotiators as civic councils, as organizations, as private people. I think we have got to rely on you, it has got to come from our recommendations through you. But I think that, as you mention, this is something that shuld be written in a formal manner through your subcommittee. Mr. Zeferetti. I think beyond that, with the new admnistration the question of human rights violations in Latin America and other countries deserves attention. I think it is imperative it be spelled out. Where there have been violations let them be brought forward. If in fact these things are going on, there has to be an understand- ing by our government; that they have to be recognized as such and addressed. This responsibility lies with you bringing it forward, and it is a little refreshing at this point that you are doing it because so far — we just started these — as far as I am concerned you are the first ones who have said it out loud. Everybody is saying something, but nobody is saying anything. Mrs. Fulton. Everybody is afraid. Mr. BoREHAM. You have the company and the labor force an secret negotiations for a period. Okay, that is okay, but we th workers have not been included in the negotiations. Secret or not. understand the negotiations have to be made in secret becaus otherwise compromise really can't be accomplished. However, don't know how it could be done, but there should be some appropri ate representative of the employees that has some input to th negotiators and, like I say, I have no idea how this can be done, if i can be done by legislation through the subcommittee or what, bu we should have some input. Mr. Metcalfe. Will the gentleman from New York yield for moment? I would like for the record to show that as chairman I have written to Ambassador Ellsworth Bunker asking him to ad- dress himself to the general question of dual nationality. We have also written to the Ambassadors for public assurances on these points of agreement that we are concerned about, so I want th record to reflect what we have done and our concern in these areas. Our concern is reflective of the input that you have given in our hearings and our visit, as well as our correspondence. Thank yo for yielding. Mr. Zeferettl Thank you, Mr. Chairman. One of the fine things here is our chairman of this committee who has been around. He knows the problem and has addressed it in many different ways. Again I thank you for your testimony and hopefully we can really learn more as we go along. It is just the beginning for me and it is still an education. But I am sure we will get the kind of understand- ing I feel so very strongly about. Mr. Metcalfe. As the chairman, I would like to also have the record to show that the committee is vitally concerned with all of your concerns and your fears and uncertainties. I believe that when the 95th Congress was reorganized, because of my seniority I may have had a chance to be before another subcommittee. I preferred to remain as chairman of the Panama Canal Subcommittee because of the background that I have been able to acquire and my deep 157 concern for the United States citizens, as well as our relationships with the Panamanians. My concern as far as the United States' prestige and the rightfulness of the treaty negotiations and the allaying of fears that have permeated and have been intensified over a period of years is also great. I wanted you to know that our committee and the Subcommittee on the Panama Canal is genuinely concerned and that is the reason I am so appreciative that these two new members were able to come down and get first-hand information, to get to know you, to get to know your problems and what constitute your fears. I would like to call on the gentleman from Indiana, Mr. Hillis, for any comments or any questions he may wish to ask. Mr. Hillis. Thank you, Mr. Chairman. I would like to ask Mr. Green if you could detail briefly for the record this incident that . took place concerning your arrest by the Panamanian regime. I; Mr. Green. Briefly, we went to the airport, myself and six others, ito see that Mr. Drummond made his departure from Tocumen t Airport. Now, we observed him going through the terminal and into the security area and we went up to the flight deck which is an open area. It is an open deck where you can see all the airplanes. You all came in through Tocumen, so you are aware of Voice. We came into the Canal Zone. [Laughter.] Mr. Metcalfe. We traveled by military aircraft. Mr. Green. There is an open deck where you can observe the airplanes which is no more than maybe fifty yards from the open area. And Mr. Drummond was detained at the airplane by the G-2 people, and one of our people with us took a picture. There were no signs prohibiting this at the airport. We are used to being able to go to an airport and take pictures of the airplanes taking off, or of people at the airport. The flash of the camera was spotted by one of the G-2 and it was J shortly thereafter they came up and rounded all of us up. They gave ( us no reason for it. They made no explanation and they took us ( down into the security room and — that is right — there was no ) identification either except one fellow kept telling us he was police. We asked them what we had done and they didn't understand 1 English. They took us down to the security room; they detained us i< for approximately a half an hour. We asked to use the telephone on * four different occasions. They absolutely refused any use of the d phone. One of the individuals that was with us did not get picked up S because he happened to be in the terminal section of the building. i He came back into the Canal Zone. The police demanded the film t from the camera that took the pictures and they would not let us f out of the area until the film was surrendered. I Not having surrendered the film voluntarily, they decided we were all due for a body search. And it was at that time that the film was taken. After the body search then they allowed us to depart. Then we came back to the Canal Zone. Mr. Hillis. They took the film? Mr. Green. They took the film. 158 Mr. HiLLis. Is this an isolated instance or are there other in- stances of harassment? Mr. Green. No, there are other instances. I don't know as we can document them, but there are incidents, for instance, for people driving into the interior, their cars were stopped. If they have any groceries or any liquor or what-have-you, that may be confiscated, and then they are allowed to proceed on their way. Mr. HiLLis. Mrs. Fulton, I have a letter here which you wrote to Congressman Snyder concerning American flag material. Mr. Chairman, I would like to offer this letter for the record. Mr. Metcalfe. Let the record show that this correspondence will be entered into the record unless there is objection. Hearing none, it will be so entered. Thank you. [The information follows:] IfJactfic Qltlur Couuril ^. (0.^5 ax 11 ^{allunt Hi'igl|ts, Canal Hour March 11, 1977 The Honorable M. G. Snyder 2330 Rayburn House Office Building Washington, D. C. 20515 Dear Representative Snyder: I am enclosing a photo of a piece of fabric I bought today In a Panama City store, Importadora Selecta. Selling for 3 yards for $1.00, the remnants of this red, white and blue fabric were folded loosely and displayed In a pile of other remnant scraps. "Poor taste" Is an understatement for describing the sale of U. S. flag material In such a manner. One friend of mine was told that the fabric was meant for "dust rags and car-washing cloths." I am enclosing a copy of my receipt to verify my purchase. I bought the cloth so I could possess evidence of the kinds of things some Panamanians are doing In their war of nerves against the United States. It was Indeed an emotionally painful experience for me to see fabric with the American flag design tossed over In a corner with other odds and ends. Because you have a reputation for unabashed patriotism, I thought you would be Interested In this provocative development. U. S. citizens In the Canal Zone who are aware of this textile store's action have become understandably upset. A lOth-yate country Is rubbing our noses In the dirt with actions such as these. We feel helpless to do anything here because a noisy American In Panama finds himself In a Panamanian Jail. Sincerely, Patricia Fulton (Mrs. James L. , Jr.) President, Pacific Civic Council 159 Mr. HiLLis. What is the story behind this material that you have photographed here? Mrs. Fulton. I was told by somebody else that U.S. flag material was being sold at a textile store in Panama City and that people were told to use the material for dusting and for washing cars. So I wanted to confirm it, for you hear some pretty wild stories and I wanted to fmd out for myself. The store was selling the fabric for 3 yards for a dollar. So a friend of mine and I walked down to this store. It was in a rather seamy section and there was a Guardia outside the store. I did not go in with the idea of making a scene, because I am not a good sprinter and I could not have made it back to the boundary in time. So we strolled around the stores trying not to be obvious that we were there to get the flag materials. It was there as you walked in, it was all wadded up in a big pile, and with some assorted other textiles. We pretended to look at some drapery material and I strolled over and asked how much the flag material was. 160 They had it cut in various lengths. It was not for the purpose of a flag. It was odd lengths. I imagine you have seen the picture I submitted of a left and right-handed flag. It has a block of stars in one corner and a block of stars in the other. So I paid 80 cents plus four cents tax for my piece of material and the manager came over and spoke to me in English. He said, ''What are you buying this for, for the parade?" And I said, ''No, not the parade." I lied and said we have been getting it for the Scouts and he said, "Oh, we have had a lot of calls for this lately." I said, oh, and I didn't pursue the discussion any further. I just took my material and left, and I have been told by others including one Panamanian man who was visiting the Canal Zone that he was told the same thing, that the material was for washing and dusting. I did not pursue that line. It was a sensitive situation. I am not a D.A.R. flag-waver, but I love my flag, and it was very obviously flag material; it was not bunting as the Southern Command Network said. No way could that have been one of those little red, white and blue decorations for the 4th of July. It was flag material. Mr. HiLLis. Do you know the source of the material, where it can be found? Mrs. Fulton. The Southern Command News came out and said that it was purchased in the United States, you know, as yard goods, excess from the Bicentennial, which may be true. But my contention was with the very tenuous-type situation between the two countries right now. The man, even if he bought it in a case lot and didn't know what he was getting, once he opened that box and could see it, there is no doubt that is an American flag. It would be in extremely poor taste to put it on the market and to display it with a pile of bluejeans, scrap material. It did come from the United States, and I am told the U.S. wholesaler is the one who should be condemned. But the Panamanian storeowner was a responsible businessman. He knew the difference. Mr. HiLLis. But, as far as you know there was no government involvement in this. Mrs. Fulton. No, no. This is just an example of the kind of harassment. And it adds to our powerlessness. There is nothing we can do about it. The burning of the U.S. flag, because it happened so rapidly on January 9, adds to our powerlessness, because there is nothing the Canal Zone police could do. Mr. HiLLis. Did you bring this up with the Embassy or the State Department? Did they do anything about this? Mrs. Fulton. Boy, did we ever. The State Department, the Embassy, did lodge a protest, about the burning. Have you told them about the note that I got on this? Mr. Metcalfe. I don't think so. Mrs. Fulton. This was a part of the popular sentiment. A group of Panamanians led by the Guardia came in on a Sunday. Very quickly, they came into the Zone, put some flags on lightpoles, burned some U.S. flags, in at least two different places in the Canal Zone, while the people were asleep, fishing, at church at the time. There were no papers printed the next day, so the word did not 161 come out in the papers, but the word started getting around the Canal Zone because we put in a vocal protest. I got an anonymous note. I am told it came from the Atlantic side. I have no idea to this day who wrote it. All I am told is what was in the note. It said, "Tell Pat Fulton to tell her friends at the Embassy if there is no official protest by Friday" — now, this was on a Wednesday at 11 o'clock — "there will be a people's protest on Saturday. We will burn semiofficial RP flags, may ask for hard- ballers' help at the border — and they signed it the "Tit-for-Tat Committee." They promised more details later. Well, I immediately called the Embassy, the Governor's office, the Information Office, and I went to the police station so that if something came out of it at least they would have the information. There was a news release that came out the same day from the administration as a comment on the situation and by Friday there was a protest published in the newspaper. A protest had been made, there was no people's protest, and I'm glad there wasn't. But to me it was evidence of a segment of our population that is very, very patriotic, and if you want to call them radical, okay, but they have had about all they can take. This group will get triggered off by some incident like this, and their actions could generate some international incident. But it is this kind of thing that happens fast, it's over, and the U.S. citizen feels helpless, there is nothing he can do. Our administration has limitations because we are here between two countries, and the Embassy says, "Well, you know how things are." This is why I asked Congressman Metcalfe when he was here in January if you congressmen would at least make some state- ments. It sounds like a pathetic gesture, but it means something to us. If you know and you are aware, and you are concerned, you do not have to threaten or even promise an investigation, but you are concerned, you are aware of this crisis and somebody in Washington knows. Because our people live in a highly structured situation here in the Canal Zone, and beginning with the Governor on down, we are given information that trickles down from the top to the bottom, and when there was no communication or acknowledge- ment given from the upper levels, we assume that they don't know and don't care. Maybe that's not true but this is the pattern of thinking after you have lived here for a number of years, and what you get officially is little. And so you can be of real help to us with little or no risk or jeopardy to yourselves. Mr. Zeferetti. I just want to ask one question. Is there any working agreement between the police force on the Canal Zone and the police force on the Panamanian side? Mrs. Fulton. There is cooperation but that coooperation can be withdrawn. The Guardia if it chooses may not cooperate. I'll give you one specific thing that sort of disturbs us now. In the Balboa Police Station apparently in an attempt to promote a liaison there is a Guardia major who has an office, an office with secretaries, files, the whole bit, with access to our files. As things are set up now, our detectives used to be able to go into Panama freely — plainclothes for surveillance, whatever. The Canal police do nothing until they check with this man. If this Guardia official says, "I don't have time to take up that project," they don't move, and so now the 162 Guardia is saying, "Our answer to the problem is more Guardia in the Balboa Station." Now, we have had a counterpart who worked for the Canal Zone police force. He has a seat and a pay telephone, and he has no plush office. The office is inconsequential, but there is sort of an encroach- ment, a creeping movement, that the Army officials are considering joint patrols with the Guardia. This does not affect us unless we drive to a military installation, but it's a little disturbing because we interpret them as moves for change of sovereignty before the treaty goes into effect. Mr. Zeferetti. Is there a reciprocal type of arrangement as far as arrests and as far as jurisdiction goes? It is strictly zone versus Mrs. Fulton. Well, they cooperate sometimes. The Canal police have been very good about trying to cooperate, but the Guardia, they may cooperate; they may not. They may be very slow in answering a phone call. Mr. Zeferetti. Mr. Green said he was held and you say there was no identification. You said there was no identification He wouldn't tell you who he was. He wouldn't tell you what his name was. Mr. Green. He said he was police, but he wouldn't show any identification. Mr. Zeferetti. How did you react? Did he use a gun to stop you? Mr. Green. No, but since I was in Panama I acted like I was in Panama. Mr. Fulton. Just the fact that somebody comes over to you and says, ''Get against the wall," do you get against the wall? Mr. Green. Basically, yes. If you have ever been to the airport, you will notice there is a preponderance of Guardia Nacional armed troops at the airport. I don't propose myself to question their authority at that port. Mr. Zeferetti. This gentleman was in civilian clothes? Mr. Green. Yes. Mr. Zeferetti. And he stopped you and he said, "I want to see the camera," or, ''Identify yourself" Mr. Green. He tried to take the camera. Initially we would not give it to him because he would not identify but then they took us down to the little private anteroom. Mr. Zeferetti. He never said, "You are under arrest," or Mrs. Fulton. Can I give you one more example of how they violate the agreement? The Guardia, if they arrest a Canal Zone policeman for whatever reason, they are supposed to inform the Canal Zone police but they do not. There was a Canal Zone policeman who incidentally is a Panama- nian National. But he supposedly, with arrangements set up by the Guardia liaison in the police station, went to Panama to get a hunting license and he thought it was just an innocent business trip. He walked into the police station; he was approached by counterintelligence; they took him into a room. He was held from somewhere between 36 to 48 hours. The Guardia lied that they didn't have him. We didn't know where he was. Now, there was an active effort on the part of a number of people and our police officials, thank God, who went and they got him. Now, this man was held in a dark room with men walking around 163 and around him asking him questions. One cup of coffee and one bathroom trip was all he was allowed. Fortunately, somebody with him in the police station, got out and got back into the zone, but the Guardia lied, and they have done it before. When U.S. citizens are being held, the Canal Zone people call and say, ''Do you have a person by the name of so-and-so in custody?" They can choose to say ''no." j I know a high school student whom I had as a student who was in on a marijuana arrest. The only reason the parents found out he was in jail was because a janitor knew the boy who was arrested with him and on his own prerogative he called this family and said the kids are in jail. It's iffy, very, very iffy, and our people are saying we don't want to live with it. Mr. Metcalfe. If I may interrupt at this time, since I am the timekeeper, I must say it is now time for us to adjourn. I do not propose that we adjourn, but I just want you to be cognizant of the time factor as we ask questions. I think this question of Guardia conduct has been explored extensively. I don't mean to cut you off. I just want to direct your attention to the fact that time has run on, and that we be prepared to stay and have staff also ask questions. Mr. HiLLis. Just brief for the record, Mr. Chairman, do you have the name of the person who was held? Mrs. Fulton. Yes. Mr. HiLLis. Would you give that for the record or would you submit it? Mrs. Fulton. I would rather submit it. The man's life is in i danger. Mr. HiLLis. Mr. Green, was there anyone in your party who understood or could speak Spanish? In other words, was there a possibility of lack of communication when this police officer said to you that he didn't understand English? Was it just obvious there was no intention to communicate. I think that's all I have. Mrs. Kennedy. One of the most frequent violations in Panama is listed under the heading of disrespect to a Guardia and that disrespect can just consist of just being there. Being alive. They don't like anything to do with disrespect. Mr. Green. There is one closing comment I would like to make. It is just a flat statement. I think it should be remembered the Panamanians do not have the market on national pride. We also have considerable pride. Mr. Metcalfe. Mr. Modglin. Mr. Modglin. I'll be very brief, Mr. Chairman. I would ask the panel when you focused on the fifth, tenth, and eleventh points of the 15 assurances in your statement, do you see any particular points of the 15 assurances which are particularly helpful to you as citizens of the U.S. community? Mrs. Fulton. Schools, housing, hospitals, are all very nice. We appreciate them. It's ironic that our people forget all those things when they see that number five. Mr. Modglin. How did the U.S. citizens relate to the so-called labor annex that was written by the representatives of organized labor in 1971 with respect to work assurances? 164 Mr. Green. Is this the one that permits early retirement and so forth? Mr. MoDGLiN. Yes, that is the one to which I am referring. Mr. Green. I think we react well to that because it gives them an excellent opportunity to get out of here. Mr. MoDGLiN. That was precisely my next question. Do you believe employees who, under the new treaty relationship, find that their jobs are not abolished should receive the same treatment as those citizens whose jobs were abolished? Should they all be treated the same or are there different categories? Mr. Green. No, they should all definitely be treated the same. Mr. MoDGLiN. Why? What is your rationale? Mr. Green. Again I go back to the original statement I made about how I feel. I feel what is being attempted here is a turnover of jurisdiction to a foreign government. The American citizens have not come down here to be employed by the Panamanian Govern- ment and he did not come down here to live under the jurisdiction of a Panamanian Government, and I feel that if you are contem- plating turning a U.S. citizen over to a foreign government you should have some provision whereby he can make his own determi- nation to leave at the time the jurisdiction is turned over. Mr. MoDGLiN. If, under the new treaty relationship U.S. citizens were considered subjects of a status of forces agreement and contin- ued for the most part under U.S. jurisdiction, that is, under military jurisdiction, would that same reasoning, would that still apply? Mr. Green. Yes. I personally have 23 years' federal service and I will not remain in the Canal Zone to be placed under any court system of the Republic of Panama. I am not used to that type of a system, and I will not subject my family to that type of a system. Mr. MoDGLiN. One more question, Mr. Chairman. This morning the Latin American Civic Councils suggested all employees of the Canal organization, regardless of nationality, be considered as fed- eral employees for the purposes of job transfers, et cetera, if there were a new treaty agreement. How do you relate to that particular view? Should Panamanians and U.S. citizens be considered in a like manner with regard to these kinds of protections? Mrs. Fulton. I think the problem is going to come from the Panamanian Government. We can say yes, we can extend these things but the Panamanian Government who has been waiting to extend their authority say, **oh, no, no, no, these are our people." We have seen this coming from the Panamanian Government for some time. We knew that when the crunch came we were not too happy with things but the non-U. S. employees were really going to be left in the cold; there are people who are going to get political jobs in the Canal entity whether they have the ability or not, because they have relatives who are in power. And when the governor made the announcement of the 15 "assurances" it was like a bucket of water in the face for the non-U. S. "We should have known these things were coming," they said. Mr. MoDGLiN. In your own views on this particular matter, should the Panamanian employee be considered under these bene- fits listed in the assurances? 165 Mr. Green. Considering the human rights aspect of it, I think certainly they should. There are some of them who are earmarked to lose their jobs, and there are some of them who do not want to work for the Panamanian Government and I think they should be given the opportunity to the same as the U.S. citizens. They've dedicated their time to the Canal enterprise and I think they should be taken care of as well. Mr. MoDGLiN. That's all, Mr. Chairman. ,i Mr. Metcalfe. Mr. Nonnenmacher. I Mr. Nonnenmacher. Thank you, Mr. Chairman, I'll be brief, too. One of you ladies referred, I belive it was parenthetically and not in the statement, to sort of a tightening-up on the Armed Services radio and TV network. I am interested in this because Congressman Snyder received a letter from Diana Davis, President of the Cristo- bal Women's Club enclosing a letter she had written General McAuliffe concerning this, which letter I would like to ask the Chairman to introduce into the record, and ask you to enlarge on this from your standpoint. She indicated it is not a very serious thing, but it is indicative of another one of these things that are happening. Would you like to comment on that? Mrs. Fulton. I would like to comment on that. When I was an English teacher at the high school I had representatives of the Southern Command Network talk to my students, so I learned a little bit more about their working policies. They made it quite clear that the funding is based on the number of military here in the Zone, and so people of the Canal Company are just sort of eaves- dropping when they turn on the TV, or the radio. Because of treaty commitments and pressure from the Panamanian Government, they have to be very careful. They are not a news-gathering agency, no advertisements, and so forth. But they recently have made it quite clear that the military gets priority in things like the inter- view program *'Que Pasa" and general information things. If you send in ads to the radio "Swap Shop" they tell you first priority goes to DOD people and military people and then to Canal Company people. This increases our feelings about, pardon the expression, frankly, being the illegitimate children in the Canal Zone. The Secretary of the Army is our chief stockholder, and we get the impression that the military are the favorites. As we say, God created the military people on the sixth day, rested on the seventh, and created the rest of us on the eighth. So this thing with the Southern Command is just another thing where they say, I'm sorry, you're out there in the cold, and we don't care. It could be a lot of their international relations, but there's a feeling of being really isolated and really alienated. We had a real problem with them last September when there were riots going on, stone throwing, tear gas, looting and the Southern Command was very calmly saying, please avoid areas of heavy traffic congestion in Panama. Now there were new people here who took that literally. We know it's a code — stay the heck out, you are going to get your head bashed if you go in. But they were saying avoid traffic congestion, which to someone from New York City or New Orleans would say it is a long traffic line or something, somebody broke down. 166 We have raised enough fuss about it that I think they have altered the policy somewhat. But we are still getting the feeling now that we are really out in the cold. Mr. Metcalfe. Mr. Nonnemacher has asked that this letter from Miss Diana Davis be entered into the record. Unless I hear an objection, it will be so ordered. [The material follows:] Honorable Gene Snider House of Representative Washington, D. C. 20515 Dear Sir: I am enclosing a copy of my letter addressed to Major General McAuliffe concerning a new unprecedented programing p>olicy of the local Armed Forces Radio and T. V. Network. "While on the surface the problem may seem small, the implication to the U. S. community in the Canal Zone is of considerable importance and therefore, I respectfully direct your attention to the final paragraph of page 2. ®l|c Cristobal J09oman'6 Club Building 81 51 , Hillvlew Terrace Margarita, Canal Zone P.O. Box 3, Margarita, C.Z. Telephone Cristobal 1 70S March 14, 1977 Respectfully, Diana Davis President Cristobal Woman's Club 167 tEl]C (Uristttbal ^tinman's (Elnb Building 8151, Hlllview Terrace Margarita, Canal Zone P.O. Box 3, Margorita, C.Z Telephone Criitobol 1 702 11th March 1977 Lieutenant General D. P. Mc Auliffe Conunander- in-Chief U. S. Forces Southern Command Dear Sir: On February 22, 1977, our publicity chairman, Mrs. Jean Stone, telephoned SCN to request that a representative of The Cristo- bal Woman's Club be interviewed on SCN ' s "Que Pasa" program in order to explain and advertise The Cristobal Woman's Club Annual Fashion Show to be held on April 30th. Lieutenant Fortenberry, who took the call, advised Mrs. Stone that because of a new policy she would be required to submit her request through the Panama Canal Public Information Office a new requirement applicable to U.S. civilians residing in the Canal Zone. Lieutenant Fortenberry further said that a tele- phone call would probably suffice; but when Mrs. Stone called the Panama Canal Public Information Office, she was told to submit the request in letter form. Mrs. Stone duly submitted that request in a letter dated February 24, 1977. On March 1st, Mr. Frank Baldwin, Panama Canal Public Informa- tion Officer, telephoned Mrs. Stone to inform he?' that her request had been denied. Upon being asked who denied the re- quest, Mr. Baldwin replied that it was Colonel Lopez. He added that Colonel Lopez had inquired whether there were any military persons in the Cristobal V/oman ' s Club and whether it was a philanthropic organization. Mrs. Stone replied af- firmatively on both counts. Not only were there military wives enrolled in the Club, but last year's president was from the military. It is well known that The Cristobal Woman's Club's contributions to charity are considerable. The fashion show in question is a non-profit activity. Mr. Baldwin submitted the foregoing information to Colonel Lopez, recommending that he reconsider the request. In spite of the satisfactory replies to Colonel Lopez' questions, however, the Colonel once more rejected the request. Although there were no reasons given for the denial, Mrs. Stone had 168 Lt. General D. P. McAuliffe 2 11th March 1977 the distinct impression that non-military U.S. citizen groups or any groups that include U.S. civilian citizens were persona non grata on SCN television and radio. If this be the case, it re- presents an unprecedented change in policy in the Canal Zone — a most untimely change at that. It seems to us that the U.S. Forces Southern Command is deliberately setting out to provoke ill feelings between U.S. civilian citizens and armed forces personnel . In his letter of March 9th, Colonel Antonio Lopez advised Mrs. Stone that SCN-TV would after all grant "on a conditional basis" the requested "Que Pasa" appearance. He cautioned, however, that the program could be pre-empted "should there be a request from an activity with a higher priority by virtue of being more clearly related to the military community." Colonel Lopez then adds: During the current transition period there are a few uncommitted QUE PASA spaces during April. Thus we find ourselves able to offer an appearance to you. This seems to imply that in future all SCN-TV programs will be closed to U.S. civilian citizens in the Canal Zone. Although we appreciate Colonel Lopez' granting our request, al- beit conditional, we deplore the institution of a new policy that cavalierly disregards the unique conditions existing in the Canal Zone. Fort Clayton is not Fort Dix. The U.S. com- munity in the Canal Zone has no other local media. It would be edifying to see the U.S. armed forces accord as much consideration for their fellow Federal employees as they often do for our foreign friends. As fellow Americans, we appeal to your sense of fair play. 1 respectfully request that you review the new policy of our local armed forces radio and television network. I believe that you will find our re- quest emiiiently just and reasonable. CC: Major General H. R. Parfitt, USA Mr. Frank Baldwin Col. Antonio Lopez, USAF Hon. Daniel J. Flood Hon. Gene Snider Sen. John Stennis Sen. Strom Thurmond Sincerely yours, Diana R. Davis President 169 Mr. NoNNENMACHER. On page twelve of the prepared statement mention was made of multinational business corporations interests being protected. It reads exactly, ''in short, U.S. taxpayers are being required to sacrifice their tax dollars, land and national security in ' order to protect the investment of multinational business corpora- tions." There was no expansion upon that. I would like to ask Mr. Green to comment on that and, if possible, to give us any first-hand information you have from American citizens who work for any of these multinationals and who live in Panama that would substantiate this charge. We have heard this in the United States too, of course. Mr. Green. Unfortunately, I do not have information with me although we couid probably provide it at a later date. We have been told, if my memory is correct, when Mr. Blacken came into the Canal Zone, to address the community — what was it — a year and a half ago or so — he mentioned the fact at that time that if we do not negotiate a treaty there is great concern that the Panamanian national feeling will be vented out on American business in the Republic as well as throughout Central and South America. This seems to be a scheme that they are using for the present negotia- tions to protect U.S. business investment in Central and South America. Mr. NoNNENMACHER. Thank you. I do have one other question There has been mention of the fact that currently teachers here would have the right to transfer only to Indian reservations. Is there any specific suggestion you would like to make for legislation that might expand upon that opportunity for teachers here, should they go back to the States? Mrs. Fulton. Well, I am aware that in the States schools are usually on a county basis, or State school systems, but if legislation can be set up to assist them in getting the teaching job that they choose or perhaps in getting a slot somewhere in the Civil Service if they do not want to be a teacher, but, as it is now, they are left out in the cold with nothing. Mr. Nonnenmacher, I would like you to expand on this in a further statement to be included in the record. [The material was not available at time of printing.] Mr. HiLLis. You have made the assertion here about there being a mass exit of some kind, possibly. Have you taken any poll or done any sort of a survey? Do you have any kind of evidentiary fact you could put into the record about what percentage of people are seriously considering this? Mr. Fulton. Okay, let me tell you why it is difficult to get definite facts. Our statements are coming from daily conversations and from a knowledge of living here of how people think. We know that events that have happened in Panama and in the Canal Zone have been extremely disturbing to our people. The immediate reaction was "I want to withdraw, I want to get away." But some people who are looking for a job may not walk around talking about it. A union man was telling me last night, that the unknown quantity are those fellows who are going to go to the States on vacation this summer and they are not going to tell us they are looking. They may find a job and they may send a letter back saying, 'Tack me up. I am finished." 95-549 - 77 - 12 170 Now, we knew the people were disturbed last year after the sick- out, and we had no idea what was coming in September and October in the riots and bombings, but we knew that because 1976 was the Bicentennial people were going back home on the excuse of a vacation, the bicentennial celebration. We knew they would be reading their vvant ads and getting interviews and checking around for jobs. A number of these people did not come back. Some came back, packed up and left. One man in my neighborhood got a job in Houston and he could have gone to work the day after he applied. He came back, packed up, and in two weeks he was gone. A number of others came back and with this continual feeling of discontentment aggravated by riots, bombs, bomb threats, et cetera — we are talking to each other about this all the time. It is an obsession, and so many people who are going to be looking, maybe they don't know if they have got a job, but they don't want the boss to know they are trying to cut the cord. They want to keep the job here, but they are going to go to the States. If they fmd something good, they will come back, pack up and leave. If they don't, they will come back but keep lookmg. Our people are very, very upset. In fact I have been kind of surprised at the extreme reaction to this number five item in the assurances. We have heard about it a long time. The State Depart- ment says you are going to Panama. Face it. In three years you will be gone. This was not the first revelation, but it's like our people froze, saying, "We don't want it." And so with the accumulation of events you are going to see more people go. Mr. NoNNENMACHER. May I ask one more question, Mr. Chairman? Something you just said reminded me of a concern that some have expressed, and that is, even though from what we have heard that the Canal Zone would be phased out over a 3-year period, there is talk, as I say, that it could be done by executive action overnight. Could you give us any basis on which you people fear this? I don't mean suspicion, but I mean a legal, specific basis. Mrs. Fulton. We had joint patrols in 1975 between the Guardia and Canal Zone police that just happened. There were problems and repercussions, and thank God, they finished it. This was partly due to traffic control during the Christmas season, but it just happened, it was done. The lease of France Field which was never described in Panama as a lease was called a reconquest of their land. But this was done by executive order. Within the Canal Zone we have been in a situation where it's authoritarian, it's been set up this way. We are fortunate to have the Councils to have an opportunity to express opinions, but things can be done with paperwork while we sit up and we watch. There has been a growing feeling of paranoia, and we have the feeling that if they can do it once, they can do it again. W'e hear constant stories, and I only call them rumors, for example, that Fort Amador is going to be vacated and that the military and the Guardia is going to take over. We're told, no, no, no, that's after the new treaty. I was told by someone who personally talked to the man that a civilian military architect was called to Building Eight in Amador, which is a CIA building, and asked, "Give us an estimate 171 I on what it is going to cost to clear this building to get ready for the : i Guardia. Now I have no Knowledge of when, or where, or what. But i this man was asked to make an estimate. Why do it unless it is ' J needed. So we are very concerned about an executive order. * I This committee was helpful in getting a resolution passed about 2 ^ years ago asking that no major changes be made by executive order ^ I before a new treaty. II 1 Mr. Metcalfe. Mr. Bernard Tannenbaum. t Mr. Tannenbaum. Thank you, Mr. Chairman. I just have one question. I On page three, and then again on page ten, you make two J [statements. On page three you say "the Torrijos dictatorship uses ; ' extreme repression against political, professional, student, and la- bor groups, and you reference expatriation of 1,300 Panamanians and murder of 500 persons. Then on page ten the statement is that the countries of Latin America say one thing in public and another ; in private. Can you bring out the source of these statements? ! I Mrs. Kennedy. I think the statement on page three was taken I from a speech that was given by a prominent Panamanian Rotarian on Flag Day, the fourth of November, 1976, before a combined group of Panamanians, members of the Rotary Club, the Lions Club, Kiwanis, the 20-30 Club, and the Junior Chamber, and he is the one who gave those figures. At any rate, the figures came from a source in Panama. Mrs. Fulton. I had a personal conversation with William Rogers in March, 1976. We were discussing this isssue and he indicated in sort of backstage conversation that privately the Latin American countries say, "Fine, no rush." Plus from my own reading of the > newspapers and watching their behavior I know that they cannot get together on coconuts, oil, chocolate, coffee, anything for very long. But the statement was made by Rogers that, yes, the United States was told by Latin countries, "yes we are satisfied with the way you are going, we're not in that big a hurry." Mr. Metcalfe. The chairman is going to ask unanimous consent that all members of the delegation, the staff as well as Members of Congress, be able to keep the record open of these hearings to have any correspondence and the same will be extended from the people i who have testified here today. Hearing no objection, it will be so ordered. [No correspondence for the record was exchanged.] Mr. Metcalfe. I have observed in the four years I have been coming down here that we have been scheduling these meetings and it becomes clear to me, unless I am misinformed by a lack of knowledge, that the only time the specific councils come together is when we bring them together. This is done simply because of the commonality that both groups represent civic personalities. Is there any consideration given to some dialogue between the Latin American Civic Councils and the United States Civic Councils? From the testimony that we have heard, from your concerns, it appears to me there are many areas where you have mutual concerns and that there needs to be this human resources exchange between the two of you. I would only j ask you to give consideration to this proposal. 172 Mrs. Kennedy. Mr. Chairman, we do have joint meetings with the Latin American civic councils at the Governor's executive meetings. They were on Mondays. There have been too many things happening. We had one in March, which is the first we have had since the 27th of October, but we had in the interim meetings with various Congressmen, with the personnel committee from the Board of Directors, with the Secretary of the Army, and those were all joint meetings. Mr. Metcalfe. I understand you do have joint meetings. Mrs. Kennedy. Yes. Mr. Metcalfe. Do you discuss your own agenda at those meetings so that there is a mutual understanding of the concerns of each group? Mrs. Kennedy. No. Mr. Metcalfe. I don't mean in advance, but I wonder whether at least your own agendas are included apart from the scheduled discussions you have. Well we are running very late, and certainly I want to express on behalf of the delegation our profound thanks and appreciation to you for giving us all the information and testimony. I think I speak for our two new members, as well as those staff members, when I say this has been most informative. Thank you very much for your presentations. [Whereupon the Subcommittee adjourned.] PROBLEMS OF CANAL ZONE RESIDENTS AND EMPLOYEES WEDNESDAY, APRIL 13, 1977 House of Representatives, Committee on Merchant Marine and Fisheries, Subcommittee on the Panama Canal, Balboa, Canal Zone The subcommittee met at 9:00 o'clock a.m. in the Panama Canal Training Center, Balboa, Canal Zone, Hon. Ralph Metcalfe (chair- man of the subcommittee) presiding. Mr. Metcalfe. The Panama Canal Subcommittee is here today to listen to your concerns, your ideas and your petitions. Since we last heard from you, many of you have written to the subcommittee or have been otherwise in touch with us. So at least I am somewhat familiar with your problems. We felt it necessary to receive testimony directly from you. After your testimony, we hope to take positive and constructive action to do what we can to alleviate some of the difficulties you face. Of course, we recognize that we can only do so much. I am very happy that we have two distinguished Members of the Congress with me, today, to listen to your concerns. Congressman Leo Zeferetti, who is sitting at the extreme left of this table, a Representative from New York who is a member of the Panama Canal Subcommittee, and a representative of the Congressional District in New York which is very much concerned with maritime commerce. Congressman Elwood "Bud" Hillis, from Indiana, deals with the Canal from the perspective of the important Armed Services Com- mittee, of which he is a member. We are delighted that he, too, could join with us. I would like to give each of these gentlemen an opportunity at this time to say a few words if they so desire. Congressman Zeferetti Mr. Zeferetti. Thank you, Mr. Chairman. As a new member of this subcommittee, I welcome the opportunity to hear your testi- mony. I have known some of you in Washington. I would hope our dialogue will resolve some of the problems we have heard here yesterday. We, the Members of Congress, are very concerned. Hopefully, together we can work together to fmd the necessary solutions. (173) 174 Again I welcome the opportunity to meet you, socially and individ- ually in testifying. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you. The gentleman from Indiana, Mr. Hillis. Mr. Hillis. Thank you, Mr. Chairman. I, too, am very happy to be here and have the opportunity of gaining personal knowledge about the total situation that exists here in the Canal Zone and in Panama, and I look forward very much to hearing your testimony and I can assure you it will be a very important part of the experience that I have had here. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you. You will notice there are six groups testifying today. We are trying to allot twenty minutes for each one of these groups. Some may go over that time, some may yield some of their time to others. I will be watching the clock very carefully to make certain that those at the tail end won't be shortchanged, so we can maintain our schedule. I am so delighted to see so many of my friends, those who have helped us tremendously in their presentations at other hearings. Some have even journeyed to Washington to give us the benefit of their thinking, which has enabled us to be able to come forth with legislation. Certainly it has enhanced our knowledge as to what the situation here is, what constitute your concerns are as they relate to this unusual period in our history where we are in the process of negotiating a very, very important treaty. I am so delighted to be with you again and to have you with us so that we can hear from you. According to my schedule, the National Maritime Union of Amer- ica, the Panama Canal Division, AFL-CIO, will be the leading witness, and you may bring anyone to the table with you, Mr. Simpkins. You may identify yourself, and identify the members that you have with you, if they need any introduction. STATEMENT OF TALMAGE E. SIMPKINS, EXECUTIVE DIRECTOR OF THE AFL-CIO MARITIME COMMITTEE, ACCOMPANIED BY RENE LIOEANJIE, REGIONAL DIRECTOR FOR THE NATIONAL MARITIME UNION IN LATIN AMERICA AND THE CARIBBEAN, AND EDWARD A. GASKIN, ASSISTANT REGIONAL DIRECTOR Mr. Simpkins. I am Talmage Simpkins. I am Executive Director of the AFL-CIO Maritime Committee. With me are Rene Lioeanjie, Regional Director for the National Maritime Union in Latin Amer- ica and the Caribbean, and Edward A. Gaskin, Assistant Regional Director. I believe we can stay within the time frame. We have a brief statement. We are appearing on behalf of the National Maritime Union, which represents approximately 7,000 workers in all phases of the operation in the Canal Zone. These members are spread throughout the Panama Canal Company, Canal Zone Government, Department of the Army, Navy, Air Force and the Armed Forces Non-Appropri- ated Fund activities. These workers are employed in practically 175 i I every bureau. We have enumerated here the Marine Bureau, the Civil Affairs Bureau, the Health Bureau, the Engineering and Construction Bureau, the Supply and Community Services Bureau, r ; the Transportation and Terminal Services Bureau, and the Person- ll nel Bureau. « j We must again express our appreciation to you for taking time I : from your busy schedule to come here and hear us and the various 1 [ problems. I Many improvements have been made over the past few years in ( the labor-management area as to equality of treatment and recogni- tion for all workers. While we have some continuing problems, none, however, compare with our concerns generated by the "List of Assurances" for present employees of the Panama Canal f Company /Canal Zone Government which are being considered for t inclusion in a new Panama Canal Treaty. We have not in the past, nor do we intend to now, take a position on the Canal Zone treaty negotiations. Our position has continually I been to do what we can as a labor union to look out for our members and leave the treaty negotiations to those expert in that 1 field. Therefore, the following comments are not intended to reflect on the treaty per se but to what labor guarantees for the protection of all Canal Zone employees are contained therein. It is our understanding that these enumerated assurances are a minimum and that they have not been finalized and are not all- inclusive. It is our further understanding that no formal, compre- hensive agreement has been reached to date on these issues be- tween the United States and the Republic of Panama. The largest group of employees outside of the Canal Zone Company/Canal Zone Government, those that work for the Defense establishments, are not mentioned in this list of assurances. This omission leaves us with the hope that their existing system of pay and employment will remain the same. Since the 1955 Treaty of Mutual Understanding and Cooperation between the United States and the Republic of Panama, the non-U. S. citizen workers' wages have been adjusted upward to more closely equate with the U.S. citizen worker. This gave recognition, among other things, to the fact that from the very outset there was established throughout the Zone and in the terminal cities of the Republic a United States cost- of-living economy. Today the City of Panama is the second highest cost-of-living city in the world. To move backward to the time where the discriminations and unequal treatment existed would benefit no one. Again, we repeat our hope that this group of employees' omission from the list of assurances is an indication that there will be no change there. Our understanding of these ''assurances" for the employees cov- ered is hampered because they are extremely vague and obscure, thereby unclear as to their meaning and how they will be imple- mented. For example, what is the meaning and intent of '*to the extent consistent with sound management"? The explanation that these "assurances" will provide the employ- ees with an understanding of the minimum level of benefits and protections being sought is extremely disturbing because they once again establish two classes of employees, each with different bene- 176 fits and protections. Through all of the vagueness, this point comes through very clear. The unequal treatment which had been perpetrated in the Zone between U.S. and non-U. S. workers since the very beginning is the basis for the many ill-feelings that exist and the confrontations that have occurred. To attempt to continue these discriminations through treaty arrangements leads us to the belief that their inherent injustices were not recognized. All employees, regardless of nationality, on the Canal Zone Company/Government payroll at the time of any new treaty should be covered and protected equally. This can be accomplished either administratively or through imple- menting legislation that is agreed to by both parties to the treaty. If one segment of the employees can be protected, then all of the employees can be protected. All that is necessary is the desire to do so. The NMU has been, since its arrival in the Isthmus, com.mitted to seeking equity in treatment for all workers in the Zone. In our continuing effort, we have been assured by all concerned that all Canal Zone workers would be fully protected under any new Pa- nama Canal treaty. We were further assured that these protections would, among other things, extend the continuation of the existing wages, fringe benefits, working conditions and labor guarantees. When President Shannon Wall of the NMU met with General Torrijos in February of this year, his assurances regarding protec- tions for all workers were more gratifying than the so-called fifteen. We must, therefore, question where the decision to treat citizen and non-citizen employees differently came from. Our suspicions become more acute when we remember the efforts to get the U.S. minimum wage coverage for non-U. S. citizens and how much more difficult it was because of the opposition by some within the Department of the Army and the Canal Zone management. It is most obvious to us now after reviewing this List of Assur- ances that it is absolutely essential that a labor representative be appointed to the treaty negotiating team not only to assure that adequate labor protections are included but that they are extended uniformly to all workers. We have prepared ourselves in anticipa- tion that labor would be invited to participate in these negotiations. When these treaty negotiations first started, the AFL-CIO estab- lished a Canal Zone AFL-CIO Committee on Panama Canal Treaty Negotiations to develop the conditions which should prevail for the workers engaged in Canal operations and related activities. The NMU participated in the development of these labor guarantees. It was then and still is our wish, as it is of the AFL-CIO, that these conditions be made a part of any treaty covering the Canal Zone. In capsule form these guarantees would cover: 1) Employees whose jobs would be eliminated. 2) Employees who would continue to work for the reorganized Canal function. 3) Employees who choose not to work for the restructured Canal organization. 4) The recognition and development of the principles of collective bargaining. 177 In conclusion, we shall mention two items that are outside of the treaty negotiations that we ask and request your help on: Continued inclusion in this year's minimum wage legislation for all workers in the related activities in the Canal Zone. The second is enactment of H.R. 1355. This is legislation mtro- duced by Congressman Frank Thompson that would extend the Service Contract Act to the Canal Zone. Currently, the employees of private contractors within the Zone are not covered by the labor laws of the Zone or of the Republic of Panama. Because of this, these workers only receive minimum coverage under safety and accident prevention requirements imposed by Canal Zone authori- ties and coverage under the Fair Labor Standards Act. Enactment of H.R. 1355 will help correct this situation, j We thank you, Mr. Chairman. That concludes our statement. We ' will attempt to answer any questions that you and the Committee may have. Mr. Metcalfe. Does Mr. Lioeanjie or Mr. Gaskin wish to make a statement at this time? Thank you very much, Mr. Simpkins, for your very fine state- ment. I would like for you to elaborate a little on your request that labor's representatives be a part of the negotiating team. Is that structurally possible as the negotiations have been proceeding, and will continue to proceed, for your request to be granted. What reaction have you had? Have you expressed this desire prior to this testimony? Mr. Simpkins. Yes. j Well, we have had regular meetings of the AFL-CIO on this subject. In an executive council meeting in Miami in February of this year, President Meany expressed that desire after a group of the unions representing the workers here in the Zone had appealed to him for help in that area. The fact the negotiations have been going on for some time we do not think would handicap us in terms of catching up. Mr. Metcalfe. With respect to the negotiators, have you gotten any reaction as to how they interpret your request? I think it is a reasonable request. I am talking about the possibility of adding to the team a labor representative. Would that disrupt this flow of the negotiations now? Mr. Simpkins. It would be our thought we would only concern ourselves with these labor guarantees and therefore not really interfere with the basic treaty. Mr. Metcalfe. I understand that, yes. Mr. Simpkins. We have, over the years, since the treaty negotia- tions first started, or particularly prior to Bunker becoming the ambassador to handle thi se, we met almost on a monthly basis with the negotiating team, and expressed to them our desires and went into detail as to the enumerated labor guarantees that we were seeking. Mr. Metcalfe. Assuming that your request is not granted, do you feel that our negotiators, especially Ambassador Linowitz who has been added to the team, can express these points that you have mentioned in your paper? You would rather be there yourself, would you not? 178 Mr. SiMPKiNS. We would rather be there, yes. Mr. Metcalfe. You haven't fully answered my question yet. Mr. SiMPKiNS. No. We would feel much more comfortable if we were there because, as I said earlier, at one time we met almost on a monthly basis with these people and then all of a sudden they disappeared and just recently we have picked up contacts with them again but nowhere near to the degree that we would like. We think that if we had someone there, they could more clearly explain what we had in mind for the protection of the workers. Mr. Metcalfe. I think it is certainly worthy of consideration. Who would be the proper authority to issue a list of assurances to the employees of the Defense Department in the Canal Zone? Mr. SiMPKiNS. Well, I would definitely think the stockholder, the Secretary of the Army, and the Governor. Mr. Metcalfe. Do you seek such a list of assurances? Mr. SiMPKiNS. Yes, we do. Mr. Metcalfe. Do I understand that the recommendations of the AFL-CIO do not make a distinction between U.S. and Panamanian citizens? Mr. SiMPKiNS. They do not make that distinction. Mr. Metcalfe. I am going to refrain from asking too many questions because of the time frame. Both the Members of Congress are on their first visit to Panama, and I want to make certain that they and staff have an opportunity to ask some questions. I will first yield to the gentleman from New York, Mr. Leo Zeferetti, for any questions he may wish to ask the panel. Mr. Zeferettl Thank you, Mr. Chairman. Gentlemen, yesterday we of the delegation had an opportunity to meet with the Ministry Office of the Panamanian Government. One of the things that I inquired about during our conversation was the question of the assurances and the question of labor and the people. The people should have some sort of input and communication with the government. The Ministry Office informed us that they had just formed a new office which would communicate with the labor unions at their request. This office will go over some of the condi- tions of the negotiations and at the same time opening up avenues of communication. If that is true — and you are shaking your head, therefore I would assume that is true — then I find that to be rewarding because in one sense we are getting certain things done that our own persons are not, and that is information. What concerns me most is the fact that those unions that were contacted have not agreed with the assurances. I would like you to comment on this. Mr. SiMPKiNS. Rene attended a meeting with General Torrijos when Shannon was here in February. Mr. Zeferettl The unions disagreed with the assurances. Mr. LiOEANJiE. With the 15 points? Yes, we do disagree on them. Mr. SiMPKiNS. You are speaking of the assurances from the Republic? Mr. Zeferettl Yes. No, excuse me. The fifteen points that were laid out by the Governor's office for the treaty. Mr. LiOEANJiE. Yes, but we do disagree with the 15 points. We made that clear to the people assigned by the General to form this 179 committee. We believe that since 1903 the non-U. S. workers have been subject to discrimination. We have established here in the Zone an American company, so all of the employees should be protected by the United States. These 15 points, especially number 12 and 14, show clearly they want to go back and have two standards, one for the U.S. citizen and one for the non-U. S. citizen, and that's the reason we are saying that whatever is covered, it must be covered all the same. Otherwise you go back to the gold and silver statement. Mr. Zeferetti. Was there ever an attempt made by the unions to get together with the Governor, to go over some of these things prior to their release, or is there any protection under your collective bargaining agreements? We are supposed to have some sort of latitude here and we are supposed to have some sort of communication between us before you put anything forward. Mr. LiOEANJiE. Let me call this to your attention. We don't have collective bargaining we just have recognition. The Governor always calls us in for consultation. However, what he tells us is limited, until not too long ago, when he came up with these 15 points. Mr. Zeferetti. And now you are advocating that you also sit in on the treaty negotiations in order to fulfill some of those obligations. Mr. LiOEANJiE. Right. Mr. SiMPKiNS. There was almost a period of 11 years when we heard from absolutely no one as to what was going on in terms of these negotiations, as they would eventually reflect on the workers here. Mr. Zeferetti. That is pretty much what we have been hearing since yesterday and today, that nobody gets told an3^hing. I just want to tell you that since I also sit on a subcommittee with Chairman Dent on the minimum wage and I will take that message back, and make sure we take a look at it. Again, I welcome you and appreciate your testimony. Thank you very much Mr. Chairman. Mr. Metcalfe. We are very happy to have with this delegation Congressman Elwood Hillis, who is a member of the Armed Services Committee. I now recognize the gentleman from Indiana. Mr. Hillis. Thank you, Mr. Chairman. I appreciate your state- ment very much. Since our visit here, particularly in the hearings of yesterday, we heard of certain fears that people in the Zone have, and reports of violations of human rights generally in Panama, such things as exile, disappearance of persons, and so forth. As we look forward in the future to the Republic taking control of the Zone and the Canal, do you feel that your organization will be able to continue operating as a free trade union, both collectively and ais to individual members? Will your organization continue to be viable and be able to exist and do what you are doing today? Mr. SiMPKiNS. We believe so. Mr. LiOEANJiE. This guarantee has been given to us several times by General Torrijos. And we do believe we will be able to operate as freely as we do now, no question about it. Mr. Hillis. In the Panamanian economy— I am not familiar— do you have collective bargaining? Are there free labor organizations, a free labor movement? 180 Mr. LiOEANJiE. Yes, we have. Mr. HiLLis. It is not different from what we know it in the States? Mr. LiOEANJiE. The same principle as the States. Mr. HiLLis. If these guarantees have been made, you will be able to function much as you do now? Mr. LiOEANJiE. Yes. Mr. Metcalfe. Next, the Majority staff member, Mr. Terrence Modglin. Mr. Modglin. Thank you, Mr. Chairman. I just have two very quick questions. Following up on Congressman Hillis' statement and questions, there is one piece of legislation that is before the Panama Canal Subcommittee right now which deals with the Smithsonian Institution and the Canal Zone Biological Area. The Biological Area has a contractual arrangement with the Panama- nian Government which it feels will protect it under any new treaty arrangement. My question: Is there any contractual arrangement that exists between the National Maritime Union and the Panama- nian Government at the present time? Mr. SiMPKiNS. No. Mr. Modglin. My second question is this: Does the National Maritime Union support all aspects of the so-called labor annex that was drafted in 1971? Mr. SiMPKiNS. Yes. Mr. Gaskin. May I say that you will note that the AFL-CIO list of assurances protections for employees, that they are also asking that as part of the labor annex that the continued recognition of the labor unions here for these employees will continue during the effect of the treaty. In other words, we are asking that this also be included in the annex. So I believe that we have a double-barreled protection as far as continued treaty operation here. Mr. Metcalfe. The Minority staff member, Mr. Nick Nonnenm.acher. Mr. Nonnenmacher. Thank you, Mr. Chairman. I note your concern for what you call the continued maintenance of two classes of citizens, as it were. Can you comment on the problem that the United States Government faces in trying to do something for the members of your unions who are actually Pana- manian citizens who, under the Republic of Panama's control, would be still Panamanian citizens? I pick up different reflections of this problem here. If we at this point try to give guarantees for people who will be shortly coming into the complete control of their government, should Panama take the Canal Zone and waterway's control, doesn't that put us in the position of trying to create, or perpetuate perhaps, a second class among only Panamanians? You mentioned very pointedly the exist- ing problem, that the United States economy has forced itself on Panama City by virtue of the American dollar and all that goes with that. I think you see the drift of my question. This situation does exist. Is there any way around that? Can the United States really guarantee anything for the Panamanian employees who by citizenship are already bound to Panama's laws in the first place? Mr. Simpkins. It would be a mutual agreement by both parties in the treaty. Therefore, it would not have the appearance or in effect be an imposition on one of the two parties in this treaty. 181 Mr. NoNNENMACHER. May I interrupt your answer, which I appreciate? I should preface this by saying that my chief concern has been, and that of Congressman Snyder, frankly, not what happens during a continuing treaty but what happens from the termination date. After that. Mr. LiOEANJiE. I thought that's what you meant. You have no control after 25 or 30, 40, or maybe 20 years after you turn control of the Canal over to Panama. Mr. NoNNENMACHER. None, you mean no American control? Mr. LiOEANJiE. No American control. Until control is given over, everyone must be treated equally. That is the responsibility of the American Government. Mr. NoNNENMACHER. Do you treat that as a question to be addressed when that time comes? Mr. LiOEANJiE. Yes. Mr. Gaskin. May I say that we have no problem, because even the chief negotiator for Panama agrees that in Panama we have precedents for this in that when they took over Fuerza y Luz several years ago these employees were making a much higher wage scale than the average worker in Panama on the labor code and special legislation was passed by Panama to give these people continued protection of all they had won over the years under the kind of enterprise they were in. So we are saying that these workmen who are in the Canal Zone can be given good protection providing both governments agree. And any administrative setup or labor laws or combination of labor laws as agreed upon by the two parties will remain in effect during the life of the treaty, and we have been given adequate assurance from them that they will go along with this, and we hope that from the American side they will also go along with this. That in this way we believe that all the employees, regardless of citizenship, can be protected equally. Mr. NoNNENMACHER. Mr. Simpkins, we are aware of the fact that the labor movement is one of the key targets for Communist penetration throughout the world — in the United States, Costa Rica, Bolivia, what-have-you. Would you care to comment on the extent of Communist penetration in the labor union movement on the Isthmus, either in the Zone or in the Republic, or both? Mr. Simpkins. All right. Rene could tell you that because he has been here and is very active in just about everything. Mr. LiOEANJiE. I have not noticed any penetration of Communists in the labor movement. Maybe I have not looked for that penetra- tion in Panama. You must understand that the National Maritime Union represents many percents of the Panamanian labor force in the Canal Zone. We are not a local. We are a division of the National Maritime Union. So we can't answer your question. Mr. NoNNENMACHER. We know there is Communist penetration in the American labor union movement. That was the purpose of my question. You certainly consider it minimal if they are there at all. Mr. LiOEANJiE. If they are. Mr. Simpkins. As a matter of fact, the history of the National Maritime Union contains a very large chapter about how they fought the Communists out in the fifties. They had physical 182 takeovers and taking over buildings as well as people. They had a struggle. Mr. NoNNENMACHER. I am aware of that. There is no question but that people in the labor movement are as cognizant of the dangers of Communist penetration as any single group in the world. I wish more businessmen were aware of it. Thank you, Mr. Chairman. That is all. Mr. Zeferetti. Will you yield for one further question? Gentlemen, one of the things we heard yesterday too from the U.S. Citizen Council group who were present, was that we had an apprehension because of the change of jurisdiction from the tradi- tional U.S. system. The criminal justice system that you have here, versus what would be a reality if in fact this treaty goes into effect. I would like you to comment on the Union's reaction to that and on your members' reaction. Because there seemed to be a great deal of fear that once the U.S. judicial system left, they would be in the hands of someone they could not cope with. Mr. Lioeanjie. You must bear in mind that the National Mari- time Union represents 98 percent non-U. S. citizens. But what you are referring to, I can't see no — I don't see no problems with that. All over the world you have bases and American citizens work on these bases. They have operations on these bases. And they fall under special status of forces agreement. So I don't see any problem with it. As I said before, we represent 98 percent non-U. S. citizens, those residing in Panama and a small percentage in the Zone. I don't see any problem. Mr. Metcalfe. The Merchant Marine and Fisheries Committee, recognizing the great importance of the treaty negotiations, has brought onto the staff a consultant in the person of Mr. Bernard Tannenbaum. We are happy to have him here to assist us in these very crucial times. Mr. Tannenbaum, do you have any questions that you wish to ask? Mr. Tannenbaum. Well, the one thing I am most concerned about is whether are you concerned about a third level of disparity by virtue of the treaty consummation, if and when one is consum- mated. In other words, will not the new Panamanian employees who come into a new Canal entity create a third layer of disparity in conjunction with the existing employees who are Panamanian citizens and those who are U.S. citizens? Mr. SiMPKiNS. That is at the date of the treaty, as to whenever they would take over? We hear the years 1990 and the year 2000. What would happen after that? Mr. Tannenbaum. Well, I know there is a lot of concern that there will be some displacement of employees by virtue of the treaty and assuming that is the fact, these new employees from Panama, would they come under the protection of the minimum wage levels that you have now achieved for yourself or would they come in under the minimum wage levels of the local Panamanian economy? Mr. SiMPKiNS. We would anticipate they would all be treated the same, regardless. We cover that— the AFL-CIO position paper on this covers this very well, as to those leaving, those staying, and 183 those who wish to leave and those that are fired and those that stay. And then also the establishment of collective bargaining which we feel we could handle, could handle a good deal of that J problem through that mechanism. Mr. Tannenbaum. You are not concerned with this issue them? Mr. SiMPKiNS. Not immediately. Mr. Tannenbaum. You don't believe this is a major issue? Mr. LiOEANJiE. As we mentioned before, the Canal is going to continue to operate under U.S. jurisdiction for how many years they decide. We believe that the new employees who will be working for the Canal entity, United States Government employees, should get the minimum wage. But as long as they are employed by the U.S. Government — in other words, we don't want to see employ- ees of the Canal leaving through attrition and other employees being hired under a different wage. We consider that they must have the same wage. Mr. Metcalfe. Any other questions? Thanks very much, gentle- men. We appreciate it. A pleasure always. Next we have the American Federation of State, County and Municipal Employees, Local 900. Mr. Mauge, will you introduce those who are present with you, and you can give us briefly the format. Are you going to make the total presentation? Will the others make presentations or will they be there to strengthen you, since you need so much strength? I say that facetiously. Mr. Mauge. Right. The gentlemen here present along with me are Mr. William H. Sinclair, who is the Area Director of the American Federation of State, County and Municipal Employees,AFL-CIO. On my right we have Mr. Robert S. Goldson, who is a Vice President of the Pacific Region of Local 900, and yours truly, Saturnin G. Mauge, President of Local 900. STATEMENT OF LOCAL 900, AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, REPRESENTED BY SATURNIN G. MAUGE, PRESIDENT; ROBERT S. GOLDSON, VICE PRESIDENT, PACIFIC REGION; AND WILLIAM H. SINCLAIR, AREA DIRECTOR Mr. Mauge. On behalf of the 3,300 employee-members of the Panama Canal Company-Canal Zone Government which our organi- zation. Local 900, American Federation of State, County and Mu- nicipal Employees AFL-CIO represents, we extend warm greetings and welcome to you and the members of your subcommittee. We welcome another opportunity to appear before you to ventilate a few important concerns which affect our membership. Specifically, there are (1) the list of assurances for present United States citizen and non-United States citizen employees of the Panama Canal Company-Canal Zone Government which is derived from the United States position, and (2) the proposed amendment of the Fair Labor Standards Act to establish a $3.00 minimum wage. Article Five of the Eight Principles for the Negotiation of a New Panama Canal Treaty between the United States and Panama signed by Secretary of State, Dr. Henry A. Kissinger and Foreign 184 Minister Juan Antonio Tack on February 4, 1974, states . . Arti- cle 5. The Republic of Panama shall have a just and equitable share , of the benefits derived from the operation of the canal in its ^ territory. It is recognized that the geographic position of its terri- tory constitutes the principal resource of the Republic of Panama ..." The Honorable Ellsworth Bunker in a letter dated February 7, 1974 to Governor David S. Parker states, . . The Secretary and I fully recognize the vital contribution that employees of the Zone and Company are making to the continued efficient operation of the Canal, and are attentive to the need to treat these employees fairly and judiciously. Appropriate arrangements will be made to ensure that their rights and interests are safeguarded. Whatever the changes agreed upon in the final treaty that will affect employees, they will take place over a period long enough to obviate or minimize personal hardship . . The references alluded to earlier were cited to focus attention on the inadequacy and prejudiced nature of the assurances for present employees of the Panama Canal Company-Canal Zone Government under a new Panama Canal Treaty as 80 percent of the workforce comprising of Panamanians and other nationals find that hardly anything substantive in terms of wages, working conditions and fringe benefits are guaranteed by these assurances for them. The assurances, if accepted as written by the Panamanian negotiators, will legalize discriminatory practices in labor-management relations which were prevalent in the Canal Zone before the 1960's. Our organization in its twenty-seven years of existence has been waging a constant battle for equality in terms of human dignity and recognition that all employees of the Canal enterprise should be treated fairly and judiciously. The assurances, instead of providing the minimum level of benefits and protection for all employees, are parochial and selfish in their nature and scope. Thousands of dedicated and loyal Panamanians and other non-U.S. employees of the Panama Canal Company-Canal Zone Government who were i given assurances in previous pronouncements about their job situa- tions now find their futures are pawns at the negotiating table. We believe the Panama Canal Company-Canal Zone Government, by the nature of its structure, operation, and longevity, must continue to treat its employees alike. It cannot, at this stage of the game, abandon some of its employees under the guise of nationality or political expediency. Hundreds of loyal employees have become demoralized, depressed, and forlorn because they erroneously thought their employer would have protected them during the storm. Today, they find themselves as the emperor did with new clothes. It is not too late to correct this anomaly. Our organization is meeting with the Panamanian negotiators to insure that all employees will be treated with equity and justice. We believe the Company-Government should do likewise for all its employees with- out regard to nationality, sex, race or creed. Our second concern is to seek support of the members of the Subcommittee on Merchant Marine and Fisheries in promoting legislation that will increase the Federal minimum wage to at least $3.00 an hour. As the members of the subcommittee are aware, the 185 wage structure of the Panama Canal Company-Canal Zone Govern- ment is based either on the Federal minimum wage of $2.30 an hour ;i for employees whose recruitments are locally derived, or the Gen- [ eral Schedule rate for employees whose recruitments are from the continental United States. As more Panamanians aspire and obtain higher paying jobs, their overwhelming numbers negate and jeopar- dize their ability to receive comparable pay like their United States counterparts doing the same jobs for a Federal agency in Continen- tal United States. Hence, it behooves the native worker to continue to earn a wage, i.e., the Federal minimum wage, that is consonant with modern living in our highly technological community. The Canal Zone workers are sophisticated by the nature of their employ- ment skills and aptitudes in promoting an operation that has extra- efficiency, the Panama Canal. The standards of living of the em- ployees must continue to rise. These employees should share in the benefits the Canal derives. One way to guarantee this aspect is through a higher minimum wage. For this reason, we ask your consideration and support in promoting this piece of legislation as the welfare of the families of these workers is within your bailiwick. We wish to thank the members of the subcommittee for another opportunity to apprise them of the concerns and aspirations of Canal Zone workers. We quote from Henry Wadsworth Longfellow's ''Hope", a fleeting thought, "What else remains for us? Youth, hope and love. To build a new life on a ruined life. To make the future fairer than the past. And make the past appear a troubled dream ..." Thank you again for your attention and interests. For the Executive Board of Local 900, Saturnin G. Mauge, President. Mr. Metcalfe. Thank you very much. I think you set some sort of record for brevity, Mr. Mauge. My first question is do you support the AFL-CIO recommendations on treaty negotiations? Mr. Mauge. Yes, sir, we do, with some modifications. Mr. Metcalfe. Fll get into those modifications. Do you find any positive aspects in the 15 assurances that were issued? Mr. Mauge. Yes. I think Number 10. Number 10 was the only one that speaks of all eligible employees? Mr. Metcalfe. Would you read Number 10? Mr. Mauge. Yes. Number 10 says this: "All eligible employees are guaranteed by current regulations, reduction-in-force and reassignment right, transfer of function rights and discontinued service retirement following involuntary separation. "In addition, the Civil Service Commission will be requested to grant approval of and/or all waivers for "early optional retirement" or liberalized severance pay coverage for employees of Canal enter- prise activities which are scheduled for elimination, reduction or transfer. "Employees whose working conditions are so adversely affected by the treaty that special consideration is appropriate may also be included in this commission request." 95-549 O - 77 - 13 186 Now, this is the only article in the 15 assurances where there is not the specificity of having either Panamanian or U.S. citizens. And that is our complaint. Our complaint is that the labels should not have been omitted and the word "all" Mr. Metcalfe. Should not have been omitted, did you say? Mr. Mauge. I said the labels that they have used of U.S. citizen should be eliminated and the word "all" should have been used. Mr. Metcalfe. That is a recommendation of which I think we will all be mindful and cognizant. Now, having said that you do support the AFL-CIO recommenda- tion on treaty negotiations, with some modifications, and having known of the great causes that you have espoused so eloquently and intelligently over a period of years, in seeking what you consider is just and fair treatment, I want you to know that we have heard during this particular visit, and it has been stimulating to us, that the Panamanian Government and, to a great degree, the Panama- nians who live in the Zone, as well as the U.S. citizens, are now talking in terms of oneness. I refer you historically back to the building of the Canal, when we started out on a very discriminatory basis by paying the U.S. citizens in gold and paying in silver the Antilleans and those who came in and who were able to withstand the heat and the malaria in order to build this world wonder. Most people have minimized that contribution. I mean, people talk about the money of the United States. They say if it hadn't been for the money and the engineering and expertise of the U.S., the Canal would not have been built. I contend that without the Antilleans who actually did the laborious work, the Canal would not have been built, even with all of the experts and money. Now we are seeking a goal, a goal that our President has been talking about in terms of human rights, of oneness of all the people in the Canal Zone and in Panama. But I notice that on page 2 you still have some doubts and some rather strong language, too, in regard to assurances. You say if the double standard is accepted as written by the Panamanian negotiators, "it will legitimatize dis- criminatory practices and bring back labor-management relations which were prevalent within the Canal Zone before the 1960s." You further say "Our organization, in its 27 years of existence, has been waging a constant battle for equality in terms of human dignity and recognition that all employees of the Canal enterprise should be treated fairly and judicially. And these assurances, instead of pro- viding the minimal level of benefits and protection for all employ- ees, are parochial and selfish in their nature and scope." Now would you please elaborate and would you please try to bring some clarification to that point? You are unhappy, or am I reading this wrong? Am I interpreting this wrong? If you still have not achieved your goal, how do you propose that your goal be accomplished? Mr. Mauge. What we are saying in synthesis is this. We feel that the assurances that were given should be given for all employees. The reason why the statement is made to discriminatory practices before 1960 is the fact of the situation that you spoke about of having the nomenclature of "separate but equal" philosophy here. 187 Now we feel the assurances that are given here, if accepted as written, would mean that we would be agreeing with the U.S. j Government of treating the U.S. citizens as a special class. This is something that I have had to live with as a boy and I continue, even as a man, to feel I am a second-class citizen. I resent this. I resent it , openly and I think the average Panamanian worker resents that. He would like to be treated as a human being. Let me put it in these simple terms. He thinks whatever the other man has, he should have. These assurances are wonderful in terms of the spe- cific people that they are protecting. But what happens to the other guy? Take it percentagewise. Eighty percent of your work force are . Panamanians, yet there is a list of asurances that comes out here ; that gives almost blanket coverage for the 20 percent. Now the 80 percent says to themselves ''but after all, I know I am a Panamanian citizen. I live in Panama; I have loyalty to Panama but I also have loyalty to the U.S. Government, and many times I have had to undergo a lot of hardship in order to protect the interests of the Panama Canal Company. Why am I not protected? Why could not an assurance be where a mutual agreement could be made that all employees, whether that person is a U.S. citizen or that person is a non-U.S. citizen, is protected?" This is the thrust of our complaint. Mr. Metcalfe. Thank you. Mr. Sinclair. I would like to make a few comments for the committee. First, because of our international union structure here (in the Canal Zone) we have two local unions. One representing Panama Canal Company employees and one representing U.S. Armed Forces employees. So, for the record, we would like you to know that our membership encompasses the entire Defense Department structure here, including the Canal administration. I was asked yesterday by our treasurer, Mr. William Lucey, to submit to you a letter which — Mr. Metcalfe. I have the letter. Mr. Sinclair. I won't read it again, but I just wanted to let you know that he wants to go on record making it clear that all the AFLrCIO people are not going to tolerate anything less than equality. In addition to this, now, I want to bring to the attention of your committee something I don't think we're really focusing on, at least I have not heard it yet. The problem is before us. The problem before us is that whether we like it, or not like it, we have a United States' State within the State of Panama, and with this we have United States laws, Federal laws, decrees, et cetera, which can be applied. The way I understand it, and I might be wrong, but if I am wrong you can please correct me — the way I understand it we are — whatever we have now is based on one word: jurisdiction. The political jurisdiction of the United States provides what we have now. The way I understand it, the point of jurisdiction is no longer an issue. The jurisdiction, the political jurisdiction over this territory will be in the hands of Panama, not at the end of the treaty, but at the beginning. 188 And at the beginning of this treaty, when we get this political jurisdiction question in operation, it wll be an entirely new ball game. Because a number of the things that we would like to hold on to here — let's face the facts of life — are incompatible with the facts on political jurisdiction. And with that, even in the operation of our union. Let no one fool anybody. There are not going to be United States unions here such as we have today. The AFSCME does not have in its own constitu- tion the authority to organize outside the continental jurisdiction of the United States. Consequently, if a treaty is signed, if we have political jurisdiction tomorrow, AFSCME will have to restructure its organization in the Canal Zone or Canal area. I see ourselves working here not as an integral part of the AFSCME, as we do now, through direct contact with Washington (because this' will not be under U.S. jurisdiction) but rather, through the Public Services International Secretariat, which is a worldwide group of public workers. Our own constitution would have to be amended. Any other U.S. -based union here will have to go through the same process. What cannot be accepted by Panama, without amending its own constitution is the right of foreign unions, includ- ing mine, to operate within its jurisdiction as we operate today. So that's another situation we have to cope with. The way we see it again, this question of political jurisdiction will cause a restructuring of wages and benefits. We asked in one of our meet- ings with the Panamanian negotiators, that suppose somebody advises us, by reading the papers, that there has been a 10-percent increase in the United States, and we went before this committee- call it what you will, the Board of Directors of the new entity — 5-4, with the majority ratio U.S., and we go before them and say we want a 10-percent increase. We say we heard about this 10-percent increase, we got a telegram, we got a call from headquarters, from London or someplace, we read it in the papers. And my question to them is: What does the United States of America say this time? They would probably say **We have the sources." What does Pa- nama say? Well, we would not identify the sources the same way. It could not be read that way. We could not even identify it by saying "in the United States there has been a 10-percent increase, we have the right to demand this obligation here," because the question comes up — ''how?" The negotiators brought out that this enterprise will be similar to another United Brands enterprise. This United Brands is under Panama jurisdiction. It comes under Panama's laws. The negotiators of that union cannot go into the Company and say, ''because in Massachusetts or in Boston or wherever the head- quarters is located today, there has been a wage increase, we demand one." No, they have to get in there and fight it out based on whatever we have locally. They use the term "United Brands." We use the term "U.S. enterprise within the scope of another country's jurisdiction, which is what this term 'editing' may mean." We talk about a mini-code made up of extractions of laws or regulations, paralleled to what we have now under the United States structure, and certain extractions from the Panama Labor Code. The fact still remains, gentlemen, that if we get a mini-code, that mini-code will be subject to the concept of the Panama Labor Code. Unless our 189 jstory is wrong, and everything else, this is what we're heading into. And I think that unless we realize this, we will not be doing ourselves a service. This is where we stand today. And whether they are citizens of the United States, or Panama, whoever works for this enterprise will be under that. We have been told, we have been assured, that the military, based on their overseas status-of-forces agreement, will have this separation. U.S. citizens will be U.S. hires, continuing as if nothing will happen to them. They will rotate as they rotate around the world today. But the non-U. S. citizens of the military will come under the local prevailing conditions which they are saying depends upon whatever the entity agrees to. And this entity, the way we understand it, cannot be anymore a U.S. Federal personality once the issue of jurisdiction is clarified. So this is an entirely new ball game. We are prepared to play it. And we have said before that with the management of the Panama Canal Administration, as it is now, our local unions, fighting with all their 'resources, have made some advancements under that system. We are saying now maybe the Panama Code is no good either. We don't know. But we are going to use it. And if this mini-code comes in, we are going to use that, too. It's a new ball game. I stop here for any questions you may want to ask. Mr. Metcalfe. Thank you very much, Mr. Sinclair. Let the record show unless there are objections that the letter that was addressed to you will be entered into the record at that time. I [The information referred to follows:] 190 American Federation of State, County, and Municipal Employees 1625 L Street. N W.. Washington. D C 20036 Telephone (202) 452-4800 Telex 89-2376 April 12, 1977 The Honorable Ralph H. Metcalfe Chairman, Subcommittee on the Panama Canal Merchant Marine and Fisheries Committee US House of Representatives Washington, D. C. 20225 Dear Mr. Chairman: Earl S. Burklund The general policy of the American Federation of State, County and Municipal Employees, AFL-CIO has always been to support its Canal Zone affiliates in their efforts to attain equality for all employees in all aspects of labor-management relations. Ernest B. Croloot Jefferson City. Clwrles L Hen Messrs. Jerry Wurf, International President; and William Lucy, International Secretary-Treasurer of our Federation, have asked me to convey to you and your Subcommittee that this continues to be our overall policy. Accordingly, we strongly urge all US government federal agencies in the Canal Zone to adhere to the concept of equality for all employees, rather than promoting or agreeing to separation of personnel policies which would be tantamount to the legalization of discriminatory labor-management relations. Gilbert Stricken Mr. Lucy attended a meeting held recently at AFL-CIO headquarters where he, in behalf of our Federa- tion and its Canal Zone affiliates, underlined our inflexible position on this score. the union that cares 191 - 2 - Consequently, National AFL-CIO is also cognizant of our view and cannot but advocate a similar position for all its members in the Canal Zone, without regard to nationality. Very truly yours. Area Director WHS/dms cc: AFSCME Local 900 Local 907 192 Mr. Metcalfe. I would like to make a correction for the record. I think I mispronounced the word Antilleans. I want to be sure the record reflects that. I believe that our conferences with the Panamanian Foreign Ministry that we were assured that the rights and the benefits may have implications on jurisdiction. I only say that to indicate to you that we are moving in the direction that had been presented to us at this particular time by Mr. Sinclair, which is very important. We don't minimize the importance of it. I have no further questions. I would like to now recognize the gentleman from New York, Mr. Leo Zeferetti. Mr. Zeferetti. Thank you, Mr. Chairman. Does the union have a collective bargaining agreement? Mr. Mauge. No, we haven't. Mr. Zeferetti. How do you function? Mr. Mauge. Advise and consent. And advise means consenting before you're advised. Mr. Sinclair. We just say yes, sir; no, sir; and so on. Mr. Zeferetti. Let me make a correction for you. The minimum wage legislation is before the Standing Labor Subcommittee and it is in the Education and Labor Committee and not in the Marine and Fisheries Committee. Mr. Mauge. We know that. We are asking your support. Mr. Zeferetti. How many people do you have who are working at the minimum wage level here now? Mr. Sinclair. I couldn't say exactly. Someone could answer that. But it's a great percentage of the workforce. Mr. SiMONEAU. The minimum wage affects the lowest grade levels adjusted up to the minimum wage, and the higher wage grades are added onto that. I don't know exactly how many people work at the lowest wage. Mr. Sinclair. But, sir, may I just add here, we do know, of course, that it affects the great majority of the non-U. S. work force. Mr. Zeferetti. Have you seen the legislation itself that was put together — that was introduced by Chairman Dent? Mr. Sinclair. We haven't seen the text of it, but we have heard of it. Mr. Zeferetti. If you like, we will send you copies so we can get your comments. I would like to relate back to some of the things we have talked about here — discrimination. Discrimination has been brought up in about three different ways. Do you find it discrimina- tory in any other way rather than just non-U. S. citizen/U.S. citi- zen? Do you have problems with it in any other way? Mr. Sinclair. Well, I think discrimination starts there. It's based on the question of nationality. You see what we have here, gentlemen is 1 read sometime ago where in the States, **in the South, they love the blacks but they hate the race. In the North they love the race, but they hate the blacks." You have a situation here where it begins with nationality. They have discrimination everywhere in the world but here in the Canal Zone you will see a white man and a black man drinking together, and this is common. So the answer is yes and no. Discrimination — it 193 exists — ^just the same as any place in the world and we are not naive enough to believe it will ever be eradicated from here. Mr. Metcalfe. That is a pessimistic attitude. I don't think Mr. I Mauge would agree with that. Mr. Sinclair. That's the way it is. Mr. Mauge. He didn't mean to go so far. Mr. Zeferetti. Do you have any means like in the National W Maritime Union, where you have assurances that the continuation □f the unions will go forth, and that these types of meetings and f (negotiations will go forward in the event of a treaty? Mr. Mauge. Yes. Actually, you kow, we have what is called a charter to operate in Panama. Our sister Local 907 also has that and there is a dockworkers union which will also speak today. They have that and we can operate right now in Panama, we don't have to wait for a treaty. We can operate with the Panamanian Govern- ment as well as with the Canal Zone Government. And they have unions operating in Panama. They have some problems like any- where else. The problems are usually solved through negotiations or consultations. Mr. Zeferetti. What is your feeling regarding the point of the treaty? What will happen at that particular point? You addressed yourself to the transition period. What happens after that? Do you throw everything out in the wind? Mr. Sinclair. You are going to have unions, you are going to have workers, and workers in unions. Mr. Zeferetti. Do you think you can be effective at the conclu- sion of that? Mr. Mauge. And I think we will be stronger. You know right now we can't strike, according to Federal laws, but when you change Jurisdiction we will have that kind of power. Mr. Sinclair. In fact, you'll have the benefits in Panama you don't have in the Canal Zone. I don't see — it's a new ball game. We loved our father, but he died, and now we have to live without him. We love what we have — maybe I shouldn't say that, you'll call my attention to that. I said the other night, you've come here so many times, the members of the committee, its chairman, you know how good this whole thing was, you know the bad conditions. Fine, if we can have it; but the ball game is changing as you see. We are not going to waste our time crying over the past. Whatever talent we have, we are going to use it constructively, and we are going to use whatever we have before us, whether it's the Labor Code or mini- code or whatever, we are going to use it. As I have often told Panamanian Government officials in our meetings, we are going to use it better than anybody has in Panama. So we are prepared to teach a few people some things. Because if we took that treaty of 1903 which everybody says is no good, using it successfully then I think we can use anything else. Mr. Metcalfe. Thank you. I recognize the gentleman from Indi- ana, Mr. Hillis. Mr. Hillis. Thank you, Mr. Chairman. I just have one question. I have found the discussion very interesting. I would like to understand, under the Panamanian law do they recognize a mini- mum wage and if so, what is it? 194 Mr. Mauge. In Panama the rate structure is based on the abilit> of the industry to pay. Mr. HiLLis. A sliding minimum? Mr. Mauge. A sliding minimum. It depends on the industry. Mr. HiLLis. You are talking about a $3 minimum wage, U.S. Will there be a comparability in Panama or where does this come in. Mr. Mauge. I want to refer I think to a question you asked the former organization. In the sense that we are speaking of twc periods. We are talking of the transition period to, let's say, the suggested year 2000. We are asking for all that kind of protection for the year 2000 and I think what Panama is saying, special legislation, or mini-legislation, will be legislated into the Panama- nian assembly to cover this 10th province as they say now, but that would be to the year 2000, or the suggested year 2000 maybe. Now after that goes, that is another ball game. So I think the question you are asking is, the $3 minimum, once we get it, we feel that will carry on the protection until that time that Panama takes over the entire thing. Mr. Sinclair. This point is not really clear here, and this is what is confusing everybody. We're confusing this point. I think it will be clear enough for us to see what's ahead. If a treaty is signed today calling for Panama's political jurisdiction, and that we have laws that do not provide for the same minimum wage, then this is what we are facing. What may elapse between now and 2000 is that those who may be picked up under the treaty, as of now, and go on as long as they are employed, we have been told, they will be pro- tected. But the way I understand it, the minute that treaty goes into effect and the political jurisdiction is established, goodbye U.S. Federal laws. Mr. Metcalfe. Unless there is an assurance. Mr. Sinclair. And that assurance is very difficult, for as I said, it's a question — let's not get into that. I don't believe in stories. I believe in what I think is facing us. Mr. HiLLis. For the record, do you think Panama can pay the $3 per hour minimum wage if they took over the jurisdiction of the Canal? Mr. Sinclair. The way I also understand it, I might be wrong again, I don't foresee the $3 being the established minimum. Those who are picked up as of the day the treaty goes into effect, and make $3 an hour minimum, will have it. But I also see this enterprise saying Henceforth, the new employees will be under a new law. At that time it will be up to the unions. If we're strong enough and raise enough hell, we may be able to make sure we get that minimum. But that's it. We must get that money. As fast as we can; I can foresee the guy going under a new treaty retaining the minimum that he has, but I can also see trouble for the employees hired after that. Mr. Mauge. Because if he didn't get $3, or somewhere near that, we'd close the Canal. Mr. Metcalfe. The last time the question of the minimum wage came before Congress we had an appreciable amount of letters from the Zone complaining about not being able to meet those new laws if they were passed for the domestics. 195 Lji I Would you address yourself to the domestics and the minimum ' 'wage? Mr. Mauge. I think the domestic question is a simple thing. One, that the average worker here would like to get the highest wage I i possible for his duties and his responsibility according to the posi- tion that he holds. If he believes that that principle is inherent to i his right, I think he should believe that the same principle stands for the domestic. She's a human being and she has the same aspirations, the same ambition and she should also have the same standard of living that is consonant with modern times. Now we could never agree with any exclusion of the domestic. The way I see it, if you want a domestic then you should pay. If you can't pay, then do the work yourself. The person is a human being, land she has the right to earn the highest wages possible. Mr. Metcalfe. Thank you, Mr. Mauge. Mr. Sinclair. Just a minute, sir. We believe in "do unto others as j we would have them do unto us." I Mr. Metcalfe. Now I will recognize the majority staff member, j Mr. Terrence Modglin. Mr. Modglin. Thank you, Mr. Chairman. You said, gentlemen, that you agreed with the recommendations of the AFL-CIO on treaty negotiations, with some modifications. ? One of the provisions in that AFL-CIO recommendations document was that the administration, the new Canal administration, shall ' provide adequate community services for all of its employees to be maintained at standards existing prior to the entry into force of the ' treaty. I Do you agree with that particular does your local agree with ' that particular provision? Mr. Mauge. That is why we said there is some modification because as the situation is, we just got through the schooling I situation that is not completely settled. We have the housing situation that is not completely settled and we think we have some new thoughts on those things and before we can just get a blanket agreement, those things would have to be worked out to our statisfaction where you would not have this subtle type of discrimi- nation going on. If the schooling and the housing and those other facilities are , equalized for everyone then we will go along with it. What we are saying is, we cannot agree to any sort of legal document that will try to maintain the thing that we have been i fighting for all over the years. You know, fighting against discrimi- nation, and then to have it legalized, then we can't change it. Mr. Sinclair. You see, in essence. Sir, even if that document were to be included, in toto, in an annex, that itself would provide some discrimination in pay, the tax factor, and security positions, which we cannot buy. We are advocating equality. We have told both sides that very clearly. Notwithstanding all the rights — we have some rights, too. We have told the AFL-CIO that we are not going to go under the AFL-CIO umbrella legalizing any form of discrimination. And I think they have that message quite clear. Mr. Modglin. For your members in the Canal Zone who are employees of the Defense Department, do you believe they should 196 have a list of assurances and protections in the treaty? If so, whc should issue those assurances? Mr. Sinclair. The way I see this, the treaty negotiators should have some broad guidelines. I am saying broad guidelines. I don'l believe they should get down to list from one to one million points. Give us some broad guidelines under which we can build up our own thing. In other words, let me get back to the question ol negotiations. We should be able to say under these broad guidelines we want so and so. But I am not too confident to have anybody sit down and tell us exactly what we are going to have to live with. Just give us the broad guidelines. Mr. Metcalfe. You just want to participate. Mr. Sinclair. That is right. We just want broad guidelines. Mr. Modglin. Mr. Sinclair, in view of your statement regarding what I believe you regard as the inevitability of Panamanian jurisdiction and, I gather, labor law, do you think the Government of Panama ought to have, or does have any responsibility for those particular assurances to Canal employees? Mr. Sinclair. They will have to, because they are partners. This is a partnership. The Panamanian Government and the U.S. Gov- ernment. The employees will be employed first by the military, which have responsibilities here, and second by this administration or entity, whatever it is. This entity would comprise a partnership. We are told it is an entity made up of the two States, Panama and the United States. One thing that is not clear in our minds is whether it will have a Federal personality. So this entity whether it is composed of five Americans and four Panamanians or vice versa, this entity has to, this waterway will be providing **x" amounts of dollars for services. That entity has the obligation to provide equal services and benefits for every employee, regardless of nationality, color, creed, et cetera, et cetera, et cetera. So that entity is the one that must have the responsibility. Mr. Modglin. The implication of your particular belief of total equal treatment, the implication I get there is that that means application of Panamanian labor law or U.S. labor law to all employees related to the Canal organization Mr. Sinclair. Once the jurisdiction has been established, it won't be a choice. They have said, you may take a section of the U.S. labor law and put it, in toto, but you cannot have that law, per se, because it conflicts with the Panamanian Constitution. So you are not going to have a choice of U.S. and Panama labor laws. If you carve out the whole U.S. Constitution and put it in and say these are the rights I want in Panama, or any other country in the world, but you cannot identify it as such, because it goes against the (Panamaniam) Constitution. Mr. Mauge. I think what the Panamanian Government has in mind is to use some aspects of the Federal law here but don't call it that because we will have new legislation that will cover the Canal Zone area and that would also cover the judicial and also the labor code and other matters. Mr. Modglin. Sir, is my perception correct that you are not necessarily advocating that Panamanian labor law be applied, but simply regard it as inevitable? 197 Mr. Sinclair. What we are saying is, whatever that entity comes 0^ 1 up with, whatever the instrument, that's what we are going to deal i(j j with. And I still feel that from a legal standpoint, a constitution is a J constitution. Whatever that mini-code says, it is still subject to Panama's law. It has to be that way. There is no other way. 3j Mr. MoDGUN. Mr. Mauge made reference to point 10 of the 15 i-: 'assurances, as to what all eligible employees are guaranteed by • current regulations, reductions in force, et cetera. ] Do you l^lieve that particular provision should apply to Panama- 'nian employees of the Canal entity as well as U.S.? Mr. Mauge. I am saying anything that you give should apply to all employees. We just want to be fair, ij j Mr. Sinclair. We are going to stick up for that. And if you want to hear a secret, I want to tell you a secret, publicly. We are hoping I that you will not abandon your citizens, then we will stick to equality. This is a public secret. If you abandon your citizens, then the whole ball game is over. So we are going to ask you not to abandon your citizens, because by not abandoning them, you are helping us. Mr. Mauge. We have something to compare with. Mr. Metcalfe. Thank you. The minority counsel, Mr. Nonnenmacher. Mr. Nonnenmacher. Thank you, Mr. Chairman. Mr. Mauge, at some point, here you say, 'Thousands of dedicated and loyal Panamanian and other non-U. S. employees of the Pa- nama Canal Company/ Canal Zone Government who were given assurances in previous pronouncements about their job situations now find their future are pawns at the negotiating table." I think that concept of pawns at the negotiating table very adequately sums up the feeling that everybody has given us who we have heard so far, and we don't expect to hear anything different. Mr. Sinclair, in the very last statement you made, your public secret, you hope we don't abandon our own citizens' rights. Mr. Sinclair. That is right. Mr. Nonnenmacher. Speaking on behalf of Mr. Snyder who is the ranking minority member and whose position is well known to all of you, he, like you, feels jurisdiction is the name of the game. Only here he probably would say sovereignty is the name of the game. He feels giving control of the Canal Zone to Panama would in effect be abandoning our citizens, were they to choose to remain here. Ultimately — and again I go back to the point I made — our concern is the continuing neutrality and defense of the Canal, permanently — because it will always be vital to the United States as well as to the free world and world trade, as well as to world security and freedom. For this reason we feel Panama should not get the Canal. That is the basic fundamental starting point. I think I could also say on his behalf that sometimes U.S. Congressmen feel that they, too, are considered by the State Depart- ment as nothing more than pawns to be ignored in the negotiations, and kept ignorant of the ultimate goals that they have. I think that the fight the Congress has put up in the last 2 years over this issue has made the State Department wake up to the fact that there is a voice of the American people up there in Washington that does 198 speak, and this committee does represent the people on this issue most specifically. I would like to ask a very key question here. I do not know which other union leaders present came out after a meeting with Presi- dent Torrijos in favor of a new treaty. I know you are one, Mr. Sinclair. I don't know if you are, Mr. Mauge, or any others here. But in view of the fact the question was asked by Congressman Hillis regarding a minimum wage in Panama, and in view of the fact that we received the answer that there was a sliding minimum wage (although we did not get a specific figure — and that is what I am going to come back to in a moment) I would like to ask a general question before getting into some specifics. Are the Panamanian union leaders who are on record favoring a new treaty which ultimately would yield control of this entire Zone and waterway to the Panamanian Government, are these same labor unions there- fore going on record a favoring lower incomes for their union members? Is my question in any way inaccurate? Mr. Sinclair. The way the question is framed, it is difficult to answer. Let me go back — first, in our mind there is no question about Panamanian sovereignty — Panama has always been sover- eign in the Canal Zone. Panama has ceded the use of certain rights in the Canal Zone to the United States as if it (the United States) were sovereign. Mr. NoNNENMACHER. I would differ with you on that. Mr. Sinclair. What I am saying here is as far as we are con- cerned. You have asked the question. I will give you the answer. There is no question about who owns this land. That is Panama. That is a legal position. Panama ceded her rights and said "You shall have these rights, blah blah blah, as if you were soverign." Panama is also saying "We want back our jurisdiction," It is none of our business to tell Panama not to get back its land and so on. That is Panama's right. We will get away from that. Our dealing here is with the labor situation. We are saying under what we have now, we want the most. That day our father dies, a new ball game starts, and we are going to play it, and we are going to get the most there too. That's the way we operate. Mr. NoNNENMACHER. I appreciate your forthrightness, and I am sure you would recognize the equal forthrightness of Congressman Snyder and those who feel just to the contrary. Mr. Sinclair. The greatness of the American system is that we can disagree. Mr. NoNNENMACHER. Right, but regarding the Zone's status— since approximately 1826 it has been a concern of the United States Government that there be a canal from the Atlantic to the Pacific. Thereafter, successive Presidents, beginning with Ulysses S. Grant and Rutherford B. Hayes, specifically sought control and ownership of a strip of land somewhere across the continent for an interoceanic canal, and that desired goal of ownership was specifi- cally mentioned in presidential messages long before Teddy Roose- velt came on the scene. But that is another subject and you have given me your opinion. Now I would like to get specific. 199 Can you tell me, or provide for the record — and you might need ' the cooperation of the other unions present — the comparative wages I at present, the comparative minimum wages at present in the Zone " jand in Panama for specific employments such as a government J jclerk, a teacher, a dockworker, a metalworker, a merchant seaman, ja policeman, and anything else you would care to include in such a list, so that the record would show what minimums at this particu- liar moment pertain to these various categories of employment. I Mr. Sinclair. First, there is no comparison with the United ^ States and Canada, those two countries of the free world. No other country in the world, including this continent, has anything similar ^' to the U.S. in dollars and cents as far as a federal minimum wage is " concerned. The last time I saw a legally written document — and I will try to get that — the minimum wage was set at 40 cents as the lowest that f employees should earn in Panama. Then it slides, depending on the ' ability of the industry to pay and the capital, et cetera, et cetera. It's sort of like Puerto Rico that has a sliding minimum, which goes up. But nobody in any part of the world, excepting Canada, as far as II know, has a minimum wage that is higher than or equal to the i United States. We are saying that until this jurisdiction is changed, we are talking to our employer, which happens to be the United States. Get the point? So we are saying whatever you pay, you pay ■ us. If tomorrow that is not there, we will be saying to somebody pay us a minimum wage. We'll have to seek a higher minimum with this new ball game we're playing. But every minimum is lower than the United States for every one of the jobs you mentioned. Mr. NoNNENMACHER. I appreciate that, but would you not admit that Western Germany, Great Britain, France, Belgium, other coun- tries in Western Europe have a minimum wage much higher than the 40 cents you mentioned? Mr. Sinclair. Yes. Mr. NoNNENMACHER. Would you please provide for the record some comparison however for these specifics, regardless of the fact Ijj that your answer in general covers it. Mr. Sinclair. What we will do for you is, I will get the exact I mininium they have, and mail it to you. Mr. NoNNENMACHER. We would like it for the record. [At the time of publication, no document had been provided.] lj Mr. Sinclair. I just want to show you something. I was shocked I out of my wits when I was comparing the salaries of prime minis- I ters. Indira Ghandi was getting $400 a month, I see, and she was the : prime minister of the biggest democracy in the world. When I saw her salary, $400 bucks per month, I said ''she needs a union." Mr. NoNNENMACHER. The previous witness from the NMU pointed out that the America economy has impacted itself upon this area of the world to the point that Panama City has the second highest cost of living in the entire world. Following the train of questions I presented to you and your answers, would you think that the removal of the United States' control over the Canal Zone would cause an enormous drop in this cost of living at the period when the treaty ends. 200 Mr. Sinclair. The cost of living. You have noted that about the cost of living in the Zone, and it's probably higher in Panama. I don't agree with that statement of Panama being the second highest city because we have information prepared by a local bank here, I think the Continental Bank, with headquarters in Geneva. They did not list Panama as No. 2. There were many other cities, Tokyo and Buenos Aires, and a few others. In Buenos Aires, we understand, one drink, a highball, is very high. Panama is not the second highest but I have been to almost every capital city and others in Latin America. I have found prices in those countries higher than Panama and in the United States, in many places. Mr. NoNNENMACHER. I think the record should show that, and I think, Mr. Chairman, that the NMU should have the right to defend their presentation that Panama City has the second highest cost of living, in view of the fact it is in their statement and is now challenged. That is all I have. [The information supplied by Mr. Sinclair may be found on p. 381; the source of the National Mature Union's statistics was the March 17, 1977 Miami Herald.] Mr. Metcalfe. Now, our distinguished consultant, Mr. Bernard Tannenbaum. Mr. Tannenbaum. For many years there was concern, and still is, and, properly so, because of the discrimination in the Zone in treatment and pay benefits between Zone employees, who were Panamanians and U.S. citizens. Now what about the disparity between the Panamanian Zone employees and the Panamanian Government employees who hold similar positions: postal clerks, policemen, teachers, and so forth? Now this income gap is even greater than the disparity in the Zone. It is maybe 300 or 400 percent and maybe more than that. Isn't this a considerable cause of friction between Panamanian Zone employees and Panamanian Government employees, and and hasn't this created a great political problem for the Panamanian Government? Mr. Sinclair. I don't agree with you on that. You have some people in Panama working for very high wages for certain jobs. Whether $2,000 or $3,000 per month, you only have so many. So you have to look at the guy who's got the right to have the job. Also in the Canal Zone, you have only so many jobs. I understand there are 40,000 or 50,000 people looking for jobs in the Canal Zone, but they can't get them because they are already taken. Mr. Tannenbaum. I am not being judgmental. I am just saying, doesn't it create a cause of friction? Mr. Sinclair. I have heard of this but I have never found it. Right now I feel that I should make three times what I'm making, and maybe there's somebody who is doing a job like mine for three times what I'm making. But I haven't got his job, you see, I have mine. So one day if that job becomes vacant, and I can qualify for it, I will apply for it. I am not going to die because he's making more money than I'm making. So I don't agree with that theory. I don't think that the worker in Panama would cut his brother's neck over here because he's mak- ing more money. He may want the job, but that's all. 201 Mr. Mauge. Another thing I don't think many people recognize is that although the Panamanian worker seems well, is earning some wages lower than in the Canal Zone he has certain benefits that the Panama Canal worker doesn't have. For example, low cost ' housing. The Canal Zone workers cannot qualify for low cost hous- I ing, which a Panamanian worker gets at a very moderate price. I And he has certain medical benefits. He gets certain subsidies in ' terms of price control, controls put on staple items when you add that. Because I have found in a study we made among Latin American unions where we find that Latin American unions ask for more social benefits than wages. You will find the wages in Latin America are low but the social benefits are high. Opposite to the American economy where the wages are high but you are paying a high price also for the social benefits. So sometimes you put the two things together, I really wonder who is coming out winning or losing. Mr. Sinclair. Let me give you an example. I went over a contract about a week ago. And from just this one item I bring to your attention — insurance. Where the employee here pays 40 percent of the premium on his life insurance policy, and the agency pays 60 percent. In this contract Fm talking, about each employee has a $40,000 life insurance policy. He doesn't have to pay a nickel for 1 premium cost. So in Latin America a lot of people prefer not to have the dollars and cents because this is where you pay your taxes. They prefer to have the fringe benefits where you don't have to pay taxes on fringe benefits. I have read — I have been through some contracts in other Latin American countries and here's one you people might be interested in. The question of vacation — a guy says "1 earn a salary 12 months a year, I pay my rent 12 months a year, my car payments 12 months a year — so when I get my months' vacation, I have no money reserved to go on vacation, because the money is already committed. So they have contracts in the public sector, I have seen them, where they get a month's bonus to go on vacation. So a guy can really enjoy his vacation. For him to pay out each month for his rent and his car and so on, then to spend $1,000 or $2,000 for travel for himself, he harms himself economically by the time his vacation is over. The agency says, okay, in addition to that we'll give you this additional month's pay at one time. In Panama we're talking about 13 months. In Uruguay they have 14 months. So you talk to these guys, and you show them your wages, and they'll say keep that. We like what we have here." So it balances out. Mr. Mauge. For example the transportation cost. The worker here has to pay his own transportation. In many of the contracts the company pays the transportation to and from work. Mr. NoNNENMACHER. Are you really saying, sincerely saying, there isn't a tremendous disparity between Zone employees and the Panama City employee? The postal clerk who does the same compa- rable job in Panama City and the Zone, that he has a wage benefit in terms of housing or what-have-you that is comparable, and the standard of living is comparable to that of the Zone employees? Mr. Sinclair. Let's use the words nearly comparable. What we're saying here is nearly comparable. Taking wages of dollars and cents. 95-549 - 77 - 14 202 Mr. Tannenbaum. I don't believe it is nearly comparable and there is, whether you are willing to admit it now for the record or not, a tremendous disparity and I do believe that this creates a cause of friction. We have heard there is a tremendous amount of friction. Mr. Sinclair. Who has told you this in Panama? Mr. Nonnenmacher. Just looking behind you, the faces that are nodding, yes. Mr. Sinclair. Never mind them. Mr. Mauge. The people in Panama? Mr. Tannenbaum. With the people in Panama, there is a prob- lem, and it is a problem that has to be faced. It is not one that can be ignored. Mr. Sinclair. Well, look. I might right now envy you gentlemen around the table for the salary you are making as Congressmen, but I don't hate you or question your right for making so many thousands a year. Mr. Tannenbaum. You may be a unique individual in that you don't bare any hatred or discrimination, even if it is practiced on someone else in your favor. The point is, there are people who do feel hatred because of discrimination of any kind. Mr. Sinclair. I don't think we have reached that point where, as some guy said many years ago, if we were to get the minimum wage in Panama, there would have been some sort of war between the workers. You've had the minimum, had amendments, had in- creases, and there's no war between the workers here in Panama, and the Canal Zone. Mr. Tannenbaum. You say there is no friction at all. Mr. Mauge. There might be some. Mr. Sinclair. Every man has some envy. But I don't think we have envy to this point, that I am going to try to kill someone because he is making more money than I am making. Mr. Metcalfe. May I interrupt? I think what we are doing is going over and over the same point and I think the points have been established both from the interrogator, Mr. Tannenbaum, as well as from your own very strong views. I think we are clear on that so if we could, in the interests of time, proceed to other questions that you may have. I have no intention to cut your questioning off at all. Proceed with your questions. Mr. Tannenbaum. I have no further questions. Mr. Metcalfe. Mr. Nonnenmacher has another question. Mr. Nonnenmacher. Mr. Sinclair, I was very interested in your presentation of that concept of a special bonus for vacations. You were not referring to Panama, were you? Mr. Sinclair. No, I was not. Mr. Nonnenmacher. Mr. Mauge, did you say Panama has a 13th month? Mr. Mauge. Yes. Mr. Nonnenmacher. In what regard? Do you get an extra bonus in effect? What is that for if it is not for vacation? Mr. Mauge. The idea is you work for an industry, the industry makes a profit. Since you are helping to make the profit, you should also participate in some of the benefits. 203 Mr. NoNNENMACHER. A profit-sharing plan. Mr. Mauge. Right. Mr. Sinclair. Actually, any employee who works is given a 13- month, salary divided into three parts. A third in April; a third in August, which goes to a savings bank for housing development; and the other third at Christmas, December 15. Mr. NoNNENMACHER. Is this applicable under law to all enterprises? Mr. Sinclair. All emploj'ees. Including government employees. Mr. NoNNENMACHER. Including government employees. Mr. Mauge. That is right. Mr. NoNNENMACHER. I am glad you said that because I was going to ask it. That leads to my next question. Believe me, I do not begrudge you that, that 13th month. But does this not have some direct bearing on the fact that the Panamanian debt is such that almost 40 percent of the budget this year is going to debt servicing? It raises the question of deficit spending. Again, I say I don't begrudge you receiving this but where is the money coming from for the Panamanian Government — you are not a government econo- mist obviously — but where is the money coming from to pay this extra money to governm.ent employees as a bonus which is in effect a higher salary when you are already in debt so deeply? This is one of the chief concerns of those of us in the States who are worried about what will happen to the Canal Zone under the Government of Panama when its own economy is so rocky? This is an extremely high debt service, is it not? Mr. Sinclair. Well, every country in the world owes money, including the United States. I understand the Communist world owes $50 billion to the Western world. This is a trend of life. If the Panamanian worker had been earning money, rather than fringe benefits, w^e can say that the 13th month would have been divided into 12 months. I can say the same thing to you. Aren't the salaries in the United States bringing up the hundreds of billions of deficit, and everything. If you had the answer, I'm sure you could sell it to everybody. But no country in the world today, that we know of, is breaking even. And many times I ask the very same question "where is the money coming from?" I don't know, but I believe it will be from the United States since your country is always helping other countries with their economic woes. Mr. NoNNENMACHER. That's why we have inflation. Mr. Metcalfe. Thank you very much. We have used all the time for this session. I now declare a 10- minute recess. Please set your watches and be back here in 10 minutes. [Whereupon, the subcommittee recessed at 10:30 a.m.] [Short recess.] Mr. Metcalfe. The hearings of the Subcommittee on the Panama Canal will come to order. Next we will hear from the Canal Zone Central Labor Union Metal Trades Council, recognized to represent the affiliated organi- zations which have individually been granted recognition. Mr. Al Graham and the others, would you please identify your- selves and then introduce those who are here at the table with you? 204 STATEMENT OF ALFRED GRAHAM, PRESIDENT, CANAL ZONE CENTRAL LABOR UNION AND METAL TRADES COUNCIL; AC- COMPANIED BY: WILLIAM R. DRUMMOND, PRESIDENT, AF&GE, LOCAL 1798; AND RALPH SHEPPARD, PRESIDENT, AMERICAN FEDERATION OF TEACHERS, LOCAL 29 Mr. Graham. Mr. Chairman, I am Alfred J. Graham. I am president of the Canal Zone Central Labor Union and Metal Trades Council. To my right is the president of AF&GE, Local 1798, Mr. William R. Drummond, that is the Canal Zone Police, and also the legisla- tive chairman of the Central Labor Union, and to my left, Mr. Ralph Sheppard, president of the American Federation of Teachers, Local 29. The CLU-MTC wishes to thank you, Mr. Chairman, and members of the Panama Canal Subcommittee, for this opportunity to express to you our views and concerns on pressing labor matters. 1. Panama-U.S. Treaty. The 15-point list of assurances presented to Canal Zone labor and civic groups by Governor Parfitt fall far short of our expectations. Some of the points raise more questions than they answer. Some points do not defme themselves in strong enough terms. Other points speak to laws already on the books that are not policed by the U.S. Government to the detriment of U.S. citizen employees. Point 10 is, for the most part, a rehash of present Civil Service regulations. Point 10 could and should be an accurate copy of the Canal Zone AFL-CIO labor annex. We again seek your support to assist us in securing a labor annex in any Panama-U.S. treaty. 2. Point 16. The CLU-MTC would like to see a point added to these assur- ances. Point 16 would state that the Panama Canal Company-Canal Zone Government will seek legislation in the United States Con- gress to permit priority admission to the United States of any non- U.S. citizen employee and his family, who as a direct result of any treaty between the United States and Panama, could reasonably find his personal and family welfare in danger as a result of the nature of his job while employed by the U.S. Government. 3. Harassment of Labor Representatives by the Company- Government. At the last regular meeting of the CLU-MTC the body voted to send our legislative chairman, Mr. William Drummond, to the U.S. to speak to the Congress on matters of interest to us. Mr. Drum- mond was refused permission to do so by company-government officials. This was the first time in Canal Zone labor history that a very old agreement between management and labor was broken. We wish to express our resentment toward this type of gagging. We ask that the Panama Canal Subcommittee instruct the governor to stop this sort of activity. It is bad enough that U.S. citizens in the Canal Zone do not have the regular outlets such as a free press or radio to express ourselves without the U.S. Government attempting to stop us in our desire to speak to the U.S. Congress. 205 \L 4. Fair Labor Standards Act Problems. As you are well aware, the 1938 Fair Labor Standards Act had a 1{ decided thrust toward the protection of the workers of the United 1 States. This Act was amended in 1974 to bring Federal employees under the coverage of the law as of May 1, 1974 among other provisions. The local administration felt that the Canal Zone area should be exempt from the provisions of the law accordingly ap- ■ pealed to the Comptroller General for such a determination. In November of 1974 he issued a ruling that the Canal Zone was ^1 , indeed intended by the Congress to be an included area. 1 It is the contention of this body that having received such a -I ruling, the local administration should have immediately applied ^jthe FLSA provisions and begun the retroactive compensation of employees. Instead, some bureaucrats here chose to ignore the ; Comptroller General ruling and decided to fight the law in the i courts. Obviously, the U.S. Government could not sue the U.S. Government. Rather, the local administration withheld payment and hoped that employees would sue for their entitlements. At such a time, the applicability of the law would have been challenged. We cannot stress enough that such actions were tantamount to the impoundment of funds by the Nixon Administration an executive branch agency decided that it would not enforce the law as promulgated by the legislative branch. In defense of our former President, at least he was elected to his position and felt that he ■ had a responsibility to a national constituency. What defense can these local bureaucrats have for their high-handed usurpation of legislative power? Is it the job of the local administration to attempt to precipitate a constitutional conflict? It is only since November of 1976 that the local administration has acknowledged its FLSA responsibilities — 2-1/2 years late. This change occurred not because of a change of heart locally, but because the international leadership of one of our member unions interceded with the Secretary of the Army. It would seem that we should be overjoyed that we are now to be covered, but our joy has been tempered by the manner in which the law is being applied. The Personnel Bureau of the Panama Canal Company has seized upon the exemption provision of the law to remove as many people as possible from FLSA coverage contrary to the thrust of the legislation and the specific directions of the Civil Service Commis- sion. I quote from Federal Personnel Manual Letter No. 55-7: ''Numerous judicial precedents have firmly established the princi- ples that: "1. FLSA exemptions must be narrowly construed and applied only to employees who are clearly within the terms and spirit of the exemptions; and "2. The burden of proof rests with the employer who asserts the exemption. "Thus, if there is a reasonable doubt as to whether an employee meets the criteria for exemption, the employee should be ruled nonexempt." Apparently, the Panama Canal Company intends to frustrate the employee's legitimate desires to be covered by the law by exempting them and then making them appeal to the Civil Service Commis- sion for redress. An illustrative example is that of the fire officers. 206 Even though the cutoff line betwen nonexempt and exempt fire officers is clearly stated by the Civil Service Commission to occur between company officers and chief officers, the Panama Canal Company has exempted all fire officers and has made the company officers appeal. In discussions prior to making the appeal, the union representing fire officers brought forth the information that the exemption being applied locally was not applied at any of the more than 100 Federal installations where its international union has locals. This was ignored. When the "reasonable doubt" issue was raised, the response was, "There's no doubt in our minds." It is this obstinate "make-me-do-it" attitude of the local adminis- tration to which we object. Chairman Metcalfe, you are aware of the police, fire and teaching personnel's retroactivity question which you have so kindly sought to resolve through the Comptroller General. We understand that even though his ruling has not yet been issued, the Canal Zone Government is expecting to have to compensate the employees retroactively. The position of the employees has not changed drasti- cally from that which was presented to the local administration. Why is it that the local administration's bureaucrats refused to face these issues responsibly when they were originally brought to their attention? When I speak of this frustrating and obstinate attitude, I am reflecting also on the experiences on two other issues which one of the CLU-MTC affiliates has had in the past year. In June of last year, the fire officers union applied for retroactive compensation for fire officers who were appointed to temporary promotions in excess of 30 days. This compensation is provided for employees in the Panama Canal Personnel Manual. Their claim was initially denied on the basis that the appointment orders were not on the proper form and that the employees were, therefore, only detailed to these positions. They have countered that permission to detain an em- ployee in excess of 30 days is supposed to be applied for in advance and that no such paperwork, on the right form or the wrong form, has ever been completed. Therefore, they feel that in the absence of any of the proper paperwork, their claim should be determined on the basis of the available evidence. This includes, in addition to the faulty paperwork, a statement from the fire chief that they were indeed temporarily promoted and the fact that subsequent to their claim, the proper paperwork has been filed and the employees are being i compensated. So where are they on this issue? After making these I points in October of 1976, they received a non-answer on January 3 and asked the questions again seeking specific answers January 27. They still have not received a reply despite telephone requests for one. The second instance is even more astounding inasmuch as they are trying to gain a benefit which is provided for by the Fair Labor Standards Act, is endorsed wholeheartedly by the fire chief and which can save the Canal Zone Government money. From our point of view, it is a morale-building measure which will permit our 24- hour workday firefighters to have a more normalizd lifestyle. It is known as "early relief and trading of time." After the fire chief and 207 the union were told by the general counsel's office that applicablee regulations did not expressly permit it, the union's international headquarters received a determination from the Civil Service Com- mission that the practice was, in fact, permissible. When the local union president took this ruling to the general counsel's office, he was told that it looked okay, but that ''while 'no' opinions can be given over the telephone, 'yes' opinions require a memorandum." On March 18 the fire chief sent a memorandum to the effect that he wanted to institute the practice in accordance with the letter from the Civil Service Commission. As of this time, three weeks later, no answer has been received. As we prepare to enter the era of collective bargaining here in the Canal Zone, we ask that you direct the local administration to quit playing games with us and to deal with us responsibly and honor- ably. The low morale of the workers will never be raised and labor- ^ management relations will continue to be strained at best until this disrespectful attitude towards the workers which pervades the local administration is changed. Thank you very much, Mr. Chairman. Mr. Metcalfe. Thank you, Mr. Graham. Do any other members wish to make a statement or shall we go right into the questions? Mr. Sheppard. I desire to make one statement. Yesterday I understood the question came up: What do the teachers actually want in connection with the treaty? Well, the first thing we want to maintain high quality education : in the Canal Zone, with the fact the majority of teachers came here I with career intent in the Canal Zone. There is little opportunity at the present time in the United States for teachers to be hired in the .. majority of communities. The teachers here in the Canal Zone are an exluded group not eligible for transfer rights to other U.S. , Government teaching positions in the Department of Defense or the other agencies that do hire teachers. The thing that we do want is full transfer rights to other equally qualified jobs outside of the teaching field, full lateral transfer rights to DOD schools in other areas, and for teachers remaining here in case of a new treaty, we want the maintenance of present basis of pay scale, not a lower scale should another agency take over the operation of the school system. We specifically want to have continued operation of higher educational facilities such as the Canal Zone College in case a new treaty does come in. It would not be covered under another entity such as the Department of Defense schools. The other thing is, I have a letter dated September 8, 1975 from Governor Parfitt which told us there would be further consultations between the administration and the unions when a contract ws concluded between the Washington,D.C. schools and the union in Washington, toward obtaining an increasing reasonable comparabil- ity between the teachers pay scale here and their working time as compared to the Washington, D.C. scales. An initial consultation with the superintendent brought a flat "no" answer with the only thing that perhaps we could submit a package. We feel the superin- tendent of schools should be asked to negotiate or to consult with us in good faith. 208 Thank you. Mr. Metcalfe. I would like to comment on Point 2 that Mr. Graham has mentioned. This is one of the crucial issues. This is in regards to the easing of the admissions, a matter twice pointed out in your paper. Mr. Sheppard, initially to interrogate you in regards to the present status of the teachers, you indicated there is no adequate program established as of now for teachers who wish to leave the Canal Zone, who, and when they leave the Canal Zone teachers system, attempt to be employed in the United States. Did I under- stand you correctly? Mr. Sheppard. There is no provision for a teacher to transfer here to any other U.S. Government teaching position. We are not eligible for direct lateral transfer or transfer to DOD schools, for instance. Mr. Metcalfe. Is it because of regulation or is it because you have not engaged in any dialogue with the Panama Canal Company to make certain that this can be corrected so that, like other civil service employees, engineers and the highly technical people, teach- ers can fmd jobs in the United States? You are saying that the teachers are different from that. They don't have the same privileges, is that right? Mr. Sheppard. That is correct. We are an excluded group and under civil service regulations we are not eligible. It is due to the fact that teachers who are hired here on other than a competitive basis, such a the other organizations. They are hired on a fully qualified basis rather than under a competitive basis under civil service regulations. Mr. Metcalfe. Let's say we get into the question of quality education. Will you give us some information on how many of the students, if any, who graduate from the Panama Canal school system are eligible to enter college and are qualified to do so? Mr. Sheppard. There is a very high percentage. I would say in the Canal Zone school system and I do not speak for the present Latin American system where they had a track system and many of the students entered other tracks but in the U.S. school system we have a fully qualified system where they go through and are eligible to compete in U.S. colleges and many, many of our students do go there. Either through taking their first 2 years in the Canal Zone junior college we don't call it a junior college, it is a 2-year college here the students do enter the Canal Zone College or they go directly to college in the United States. Mr. Metcalfe. I talked to a lady last night and she indicated just the opposite, that there is no provision where the students were qualified to enter the United States institutions. I know of excep- tions of course to the contrary. That is the reason I raised that question. Mr. Sheppard. Are you speaking of the two systems as we previously had them, the Latin American system and the U.S. system? Mr. Metcalfe. I would like to include both of them, if I may, so we could have the distinction. I am concerned about the students. I am concerned that they go to school and I am concerned as to whether or not they are sufficiently educated to the point where they can enter a school of higher learning in the United States. 209 Mr. Sheppard. I can speak for the U.S. school system is a fine school system. The quality of the teachers is very high. The stu- dents who graduate from that system are excellently qualified to proceed with higher education. Mr. Metcalfe. What about the Latin schools? Mr. Sheppard. I have not had the opportunity to thoroughly sit and study the Latin schools. Under the track system, as you know, many of the students in those schools elected tracks that led to other than college preparation. They led into vocational training and I have heard all of the pros and cons that have been presented. The best knowledge I have is that this system was established in approximately 1953 due to the fact they wanted to have a school system which would enable those students to go into Panamanian I culture. Mr. Metcalfe. Mr. Sheppard, how is the consolidation of the school system going? Is it going smoothly? What's your opinion? " Mr. Sheppard. The merger of the system appears to be progress- ing in a smooth manner. At the present time the grades through 8 grade, the merger has taken place, although the first two that we will have coming into junior high schools will be in September this year. Up to this time kindergartens through fifth grade have been merged but there was a very small number of students and teachers ! involved in that part of the merger. We certainly look forward to giving every opportunity to the students who do come into our school system. Mr. Metcalfe. Yesterday in our meeting of the civic councils it I was proposed very strongly that they accelerate this integration ^ program rather than proceed on the basis of phase 1 and phase 2 progressing into phase 3. Do you think the integration program should be accelerated? Mr. Sheppard. Was that the Latin American Civic Council or the U. S. Civic Council? Mr. Metcalfe. The Latin American Civic Councils. Mr. Sheppard. I understand it was in the Latin American civic groups ~ in the communities themselves there was a lot of debate as to whether they should accelerate this or whether they should not and I believe at the present time the Governor has left the decision up to the Superintendent of Schools based on the students and the parents desires within the Latin American communities. They would have another poll taken this coming year to deter- mine whether there are enough students who desire to remain in the system they are now in until they graduate or whether those students should be given the opportunity to come into the United States ; students — Mr. Metcalfe. Are you in a position to indicate from your point of view and from your perspective whether or not, with your ! knowledge as it exists of the integration program to date, there should be an accelertion of the integration program or rather should we follow the guidelines that have been established already? Mr. Sheppard. I believe the guidelines as they have been estab- lished should be followed because this gives the students within the Latin American schools the opportunity to make their choice so that they will move at this time or later and I understand many of 210 the students who are in the track system leading toward things will be in a totally unsatisfactory program if they do change. Mr. Metcalfe. If it's accelerated. Mr. Sheppard. If it's accelerated. That some of the students who were in the 10, 11 and 12 grades at the present time will not be given the opportunity to finish the program that they desire to finish. Mr. Metcalfe. Do you have an opinion as to whether or not a student must be educated by a U. S. citizen? As a recall the figures, I believe one-third of the teachers, the Latin American teachers hope Mr. Sheppard. I have very strong opinions on the fact that U. S. black students should be educated especially in the social studies areas, by a U. S. teacher, not by a Panamanian teacher, who perhaps has been indoctrinated. I do not want to take the chance v/ith our students that they would be indoctrinated into a philosphy that is foreign to our concepts. I am speaking particularly of the social studies area. Mr. Metcalfe. I think that is very important that you bring out as to what the various studies do and not put this on a racial basis or citizenship basis, because you've got good teachers among the U. S. citzens who are teachers as well as some of the Panamanian teachers who are very good. Right? Mr. Sheppard. I don't believe I heard you right. Mr. Metcalfe. I am saying that teaching experience, if it's on the basis of the knowledge possessed, as in the social studies area where the chosen teachers would have that background and experience and feeling for the subject matter, provides the best qualified to teach the various subjects, but the choice of teachers should not be based upon nationality classification, either United States or — Mr. Sheppard. I am thinking that in the areas such as perhaps mathematics it probabably doesn't make any different who teaches that subject based strictly on better citizenship. We have the problem in elementary schools of the child being exposed for a full day where undoubtedly the philosophy other than the United States philosophy would be advanced. Mr. Metcalfe. Thank you. Mr. Graham, what is the best means for labor in the Canal Zone to communicate with the United States negotiators? Mr. Graham. At one time we had the idea that by reforming the Pancom Committee which we have requested — this is an AFL — CIO committee — which for the most part has representation of all the different local unions in the Canal Zone, that we would use that as an instrument to contact treaty negotiators. In other words it would be an AFL-CIO input into the treaty rather than the local unions struggling to do it. It would be done actually on the Washington level with natural backup by our people here in the Canal Zone and the professional labor people from the AFL-CIO handling the case for us. Mr. Metcalfe. That is very similar to the testimony we pre- viously heard where Mr. Tal Simpkins of the National Maritime Union has indicated that they wanted to be participants and negotiators. 211 Do you concur in that thinking? Mr. Graham. Yes, very much. I would like to see a member of the Pancom Committee in fact on the negotiating team whether it be the Chairman or someone else in this committee. j Mr. Metcalfe. How are the collective bargaining talks between labor and the Canal Company going? Mr. Graham. We have a problem with that. The Secretary of the Army has not appointed someone to take Mr. Veysey's place so as a I result the Canal Zone Civilian Policy Coordinating Board cannot meet. As it is a collective bargaining issue for the Department of Defense as well as the Panama Canal Corporation — the Canal Zone Government issues — everyone down here in those agencies has to agree to the collective bargaining proposals that we have put to the company government and the military, and that is what has stopped right now, waiting for somebody to become the chairman of this committee so that the company/government and the Depart- ment of Defense can present them with our collective bargaining proposals. Right now we are sort of in limbo waiting for something to I happen. Mr. Metcalfe. Thank you. I yield to the gentleman from New York, Mr. Zeferetti. Mr. Zeferettl Thank you, Mr. Chairman. Mr. Sheppard, if you would, it is the history of Civil Defense, that ! under the merit system, never to accept any lateral entry of anyone going from one branch to the other, be it teaching positions or anything else. Do you have any support from the civil service groups, even under the umbrella of the National Teachers Association; or any other group to give you support for that kind of lateral entry under the civil service umbrella? Mr. Sheppard. Speaking within the same field, the teaching field, I believe there is precedent. In fact, that when areas or jobs are done away with on a reduction-in-force that a stopper list has been established and people have been hired from those stopper lists prior to any new recruitment from outside of the services. The talks have been negotiated by the schools here with the Department of Defense where they have indicated it is possible that they will give cnsideration to teachers here prior to recruitment. The thing we would like to do and get your support in is an additional little push from outside so it becomes more, if possible, a mandatory thing that they consider the teachers here prior to recruitment. Mr. Zeferetti. Did the other teachers' organizations back that kind of movement, for the national teachers' groups? Mr. Sheppard. Yes, the American Federation of Teachers, the National American Federation of Teachers does back the position that we should get initial consideration. Mr. Zeferettl Thank you. Mr. Graham, maybe you can give me a little bit of insight in to the area of your negotiations, so that some of the points you bring out here and some of the opposition you have had even to comply with law. 212 Which local government did you negotiate with? How is that done? What is the structure of the Army? Mr. Graham. Normally it is kind of a slip-shod situation. Nor- mally it is the personnel bureau we deal with, or Mr. Simoneau the labor management specialist with the Governor, and we will bring up those things. Occasionally we have meetings with the Governor, actually, shirt-sleeve meetings, and we present our problems to him. This, in one way or another, will get the ball rolling. We won't get an answer at all or we will get some kind of an answer. On big issues like the FSLA, of course, and the coordinated federal wage system, we seem to run into blockades. If any of these things are of financial benefit to the employee. We are not asking that the United States Government become crooked and pay us something we don't have coming, but when v/e have it coming we want it and we don't understand why it takes 2- 1/2 years for this agency to do something that the Federal Govern- ment and the United States has already done and accomiplished. Mr. Zeferetti. Do you have an appeals board? Do you have anybody you can go to, other than the structure that's already in place. In other words, when you were refused, under the law, did you have a place to go, could you write to somebody, or could you visit anyone? Mr. Graham. We get opinions from the commission; we get opinions from the Comptroller General. Then, of course, if you want to get really wild you can get a member and make him a grievance and go through a Canal Zone board of appeal type situation and hope you can get some kind of a class action — which, of course, is ridiculous because nobody is ever going to do it. So really it is very difficult, particularly without a collective bargaining posture, which we don't have. Mr. Zeferetti. There has been a change since 1974. What do you do when there is a change in the people who do the negotiating? In other words, this goes back to 1974 when there was different Governor, I don't now whether you were here then or not. Mr. Sheppard. We would do it through the personnel bureau which is normally a constant operation here in the Canal Zone. They would be the ones who would make up their minds whether — Mr. Zeferetti. My point is, sir, that they continued to refuse the acceptance of review under the law at that time and there was a continuity from one director to the next. Mr. Graham. The director remains the same. You could say from one governor to another. Mr. Zeferetti. From one governor to another or to the next? Excuse me. Mr. Grahmn. You see it is not always the governor's fault. These things zero in on the General Counsel. It always seems to end up there and that is where it dies. You can pass a law — for instance the Federal Wage System by Congress specifically excluded the Canal Zone. It stated that right in black and white. But this man will take this law, because it is going to result in a down-grading of 1,300 people, if he can get away with it, and find nowhere in there that it says that you can't do it administratively, so that is how we do it. Then you have the FSLA, which says you must do it, but he will nitpick every bloody sentence in there to see if somewhere we can stretch it to include people who shouldn't be included in the exemption policy or what can we do in general to delay the whole operation? Now, imagine the expense of this to the company? You owe 2-1/2 years of retroactive pay and the employees are going to start screaming, so we have to pay a bunch of accountants overtime to run the computer to pay people you should have been paying in the first place, and you would have saved money right off the bat. So it igoes on and on and on. Right now we have the D.C. problem here. For years we have had a very generous agreement with the Washington, D.C. office for the school teachers and so on like that. They come into a City Govern- ment in D.C. ''Bam, there's the paragraph I have been looking for, by God. Now I can stop them from getting that money." Mr. Zeferetti. It seems to me though there would have to be some sort of mechanism put into place to enable you to have a place ito go, whether it be the Governor's office direct or another appeals board system. Mr. Sheppard. We can go to the Governor's office and as Con- gressman Metcalfe can tell you we quite often have to go to him. The Panama Canal Subcommittee in fact in the last few years has been the only thing we can do to apply pressure to get us things we actually do deserve. Mr. Metcalfe. I regret exceedingly that because of the number of witnesses who must testify, to give us a chance to interrogate, that I will have to now invoke the five minute rule. Proceed. Mr. Zeferetti. One more question, Mr. Chairman. It is a question of Mr. Drummond's denial to speak before the Members of Congress, as the legislative chairman of your particular group. I would think he would be the proper person to come down and give that kind of testimony. What was the reason given for his refusal? Mr. Graham. Mr. Drummond is right here. Mr. Zeferetti. I am directing it to any one of you who wants to respond. Mr. Drummond. Congressman Zeferetti, when this thing was brought up there was a lower level indication to me, in which I appealed the decision not to allow me to go to the States, that the Company/Government had been more than generous in the past, in my individual case, in giving me leave to go to the States, either extending leave when I didn't have it or giving leave without pay or some similar type provision. I strongly emphasized that I wasn't acting as an individual, I was acting as a representative of the employees and that it was a case with this particular committee, or subcommittee, which was of the Appropriations Committee, that there was a great need for the employee to be represented there. Mr. Zeferetti. Excuse me. Was your group asked to come down and testify or send a representative to testify? 214 Mr. Graham. The legislative chairman had indicated to the body that he had requested to testify. He came before the body. The body approved his going. Mr. Zeferetti. Go on. I'm sorry. Mr. Drummond. At the Governor's level and also at the lower level I indicated there had been a mix-up in the person who was going to testify. One of the witnesses, a man by the name of Philip Harman, and myself, were being evaluated, one or the other, and during the conversation with the committee counsel or committee assistant, it seemed to me apparently that Mr. Harman would testify. I indicated to the Governor then that there was a mix-up there but it was not an overriding problem, and so I requested that I be allowed to participate in this hearing. Mr. Zeferetti. Who chose Mr. Harman? Mr. Drummond. I believe the assistant counsel of the subcommit- tee for Mr. Long did. When I arrived in Washington, D.C. the problem was resolved by allowing Mr. Harman and myself to testify. Mr. Zeferetti To come back over here? Mr. Drummond. Yes. In any case the issue was, either resigning or going AWOL in order to testify. I strongly indicated to the Governor that considering the fact that you have got taxpayers here that should be represented, and they are not being represented, certainly the agency is not going to represent them on this particu- lar matter which happened to be human rights, I felt a vested, stong indication that I should go to the States, regardless of whether or not the Company /Government gave me permission to go. I had two choices to make, either resign or go AWOL. I chose to resign to go up there. I felt there was a great need there and — I resigned. The Company has now said that since I performed duty subse- quent to submission of the resignation, I withdrew it. I withdrew it. Now, it is my understanding I am going to be charged AWOL for that period of time that I was off the Isthmus and the day I got back. Mr. Zeferetti. You say under your agreement they gave you the right to have these type of individuals go down and testify? Mr. Graham. Oh, yes. The metal trades has had this with the Panama Canal Company since 1913. It has never happened before. As legislative chairman that is his job. He is our lobbyist and when the body votes to send him up the company has never ever re- stricted his activities and we have had people up there over a year straight in the past off the Isthmus and have never had any trouble. Mr. Drummond. I would like to extend further that there was a protest that was going on for several weeks, and the whole Company/Government knew that I had every intention of going up, from my supervisor on up. The Labor Management Relations man was informed a week, two weeks before. Mr. SiMONEAU. Let the record show three days. Mr. Drummond. I am not talking about formally; I am talking about informally. Mr. Zeferetti. I don't want to take up any more time, but I will speak to the Governor and to the people. I would just like to fmd out a little bit more. [The following information was provided by Mr. Drummond:] April 17, 1977 STATEMENT OF EVENTS SUMARIZED BY WILLIAM R. DRUMMOND BEFORE THE HOUSE PANAMA CANAL SUBCOMMITTEE ON APRIL If. 1^77 IN BALBOA. CANAL ZONEi ACTIVITIES THAT LED TO MY RESIGNATION FROM THE CANAL ZONE GOVERNMENT. 1. In February 1977, while in Washington, D.C., I had been informed that the House Appropriations Committee, Foreign Assistence Subcommittee, had intentions of holding "Human Rights" hearings in March of 1977. Because I was to shortly return to the Canal Zone, I did not then directly contact the Staff CounjE'l of that Sub- committee on this matter. However; I was able to con- firm that these hearings would be held, and I made ar- raingements to contact the Subcommittee indirectly. 2. Upon my return to the Canal Zone, I telephoned the Sub- committee's Staff Assistant, Mr. Donald E. Richbourg, who instructed me to write to the Chairman for an invit- ation. I did so soon after making this telephone contact. 3. I set about informing various members of the Police Union that I intended to testify on this matter, and my reasons for the merit of this action. I informed several members of the Central Labor Union, and several U.S. and Non-U. S. Canal Zone Civic Council leaders of the importance of these hearings, and I indicated that at least one Civic Council representative should also at- tend these hearings. 216 -Page Two- I held a C.L.U.-M.T.C. Legislative Meeting, to report on my activities in Washington D.C. and I also brought out the fact that this hearing was to be held, ajid the merits of attending it. 5. In Mid-r/larch 1977» The Canal Zone Governor formally pre- sented a list of labor issues to the Canal Zone Labor Unions. One day after this event occurred, the Canal Zone Balboa District Police Commander, M.P. Gordon, held a meeting on this subject at the "Police training center". I attended and spoke at that meeting. I clearly brought out at that meeting that I intended to testify, along with several "Panamanian exiles" at this hearing in Washington. 6. Soon thereafter, the Canal Zone Police Union held a meet- ing to authorize my departure to Washington during the time that this hearing was to be held. 7. Also after the Canal Zone Governor had presented his list of labor issues; the Central Labor Union-Metal Trades Council held a meeting and voted to support me at these hearings. I clearly brought out in this meeting that I would have no ]t)roblem testifying. (Just prior to sub- mitting my request to the C ,L.U.-M,T . C . , I was informed by Mike James, a Director of the Canal Zone Public In- formation Corporation, that Mr. Phillip Harman had been selected to testify at these hearings. I informed Mr.. James that for various structural reasons Mr. Harman could not ideally represent the various labor and civic- council units within the Canal Zone on this matter. I further assurred Mr. James that the problem would be easily resolved when I got to Washington, D.C.) I also gave this same assurance to the members of the C.L.U.-M.T.C. prior to their voting on this trip. 217 -Page Three- B. At a Local 1^, A.F.G.E., where I was an invited guest, I again brought out that I would testify at this hearing. 9. Also, soon after the Governor released his labor paper, I discussed this hearing matter with the labor relations specialist for the Governor, Mr. P. Simoneau. Mr. Simoneau has indicated that I am in error in recounting this meet- ing. I see no need to argue the issue. The point that I make is that prior to submitting formal papers requesting leave in order to attend these hearings, Canal Zone Management was fully aware that I was going to the States to testify at these hearings, not as an individual but as a rep- resentative of labor. 1. On March 23, 1977 I submitted a formal leave request for March 27, 1977 through April 8, 1977. 2. On Pidarch 25, 1977» my leave request was turned down. I immediatly set about appealing this decision up to and including the Governor. 3. At the level of the Lt. Governor on down I was informed: a. The agency had, over the last several years, been more that fair in granting me leave in the past. They had indicated that my activities in this regard were causing a disruption in proper or- der within the police division and that a line had to be drawn sometine. They had indicated that I had not been invited 95-549 O - 77 - 15 21S -Page Four- at these hearings. b. I in tiorn, informed these supervisors that I was not acting in the capacity of an individ- ual but rather as an elected representative of the police union and the Central Labor Union- Metal trades Council. This matter was of extreme importance to all Canal Zone employees and the Congress as well. ivir. Harman could not speak for labor in the Canal Zone and that this problem could be easily resolved when I got to Washington. The Governor repeated much of the same position that I had been told by his subordinates and further stated i a. Aftet this matter had been fully staffed, he had made the decision not to grant my leave request. b. Me emphasized that there had been no outside influence in this matter. c. He suggested alternate ways in which he felt I could present my views at this hearing When I spoke to the Governor I repeated the above and stated 1 a. Even discounting all of the above the residents of the Canal Zone, as tax-payers, had a right to ensure that their view, given its best face, was presented to the Congress. 21M -Pa^e Five- b. I brought out the extreme importance of the jurisdiction and jubject matter of this sub- committee hearing;. c. I stated my strong belief that my duty, as a government employee was to the U.S. tax-payer first and to the agency second and that any further action that I may take on this matter would be based on that premise. 6. On the 26th of March 1977* I submitted a copy of my resig- nation to the Lt. Governor at his home. 7. Soon after I took this action, I met with the President of the C.L.U.-M.T.C. , Alfred Graham, and several other Labor and Civic leaders; all of who admonished me for taking the action that I did. They demanded that I with- draw my resignation and that I report for work that same night. I was informed by Mr. Graham that the C.L.U.-M.T.C. had a long standing agreement on this matter, and that if allowed to stand, I would be the first representative in the history of the Canal to be refused this courtesy. He further stated that this action would severly damage the Canal Zone Labor movement, I agreed to return to work that evening and requested Mr. Graham to contact Mr. Simoneau and inform him of my in- tentions . 8. On March 30, 1977, after discussing this matter and the content of my presentation with Mr. Donald Richbourg, I was invited to testify at these hearings. 9. On April 11, 1977, I met with Police management and the Civil Affairs Director, Mr. Cotton. 220 -Pa^e Six- At this meeting, I was formally told that the Governor had set my resignation aside because it was unclear of my intent, and that I was being carried in the statuse of leave without pay until my return to the isthmus. (A.W.O.L.) I was further informed that I would be charged administratively for the time period that I had been absent, unless I reaffirmed my intent to resign. I was given un- til Thursday, April l4, 1977 in which to make a decision. 10. On Thursday, April 1^, 1977, I returned to my position as a Canal Zone Policeman. William R. Drummond , Chairman Legislative Committee Central Labor Union-Metal Trades Council. Chairman, House Appropriations Subcommittee cc; Chairman, Panama Canal Subcommittee President, C.L.U.-M.T.C. JOHN J. ruVNT. JR., OA. Congregiei of ^Hnfteb fetatetf Houije of i&epres(entatibts( jc Committee on iSppropnationK Oofiibington, jD.C. 20515 MINORITY MEMB ( aAucua, Mor^. March 23, 1977 ! AND «TA^ Mr. William R. Drunmond ' P.O. Box 1994 Balboa, Canal Zone Dear Mr. Drunmond This is in further regard to your requeit of Chairman Long that you be given an opportunity to present testimony to the Subcommittee on Foreign Operations Appropriations. The Subcommittee plans to hear public witnesses on Wednesday, March 30, 1977, Due to the Subcommittee schedule and the large number of witnesses requesting to appear, we are by necessity limiting each witness to ten minutes. In light of the brevity of your proposed appearance before the Subcommittee and the previously scheduled appearance of Mr. Phillip Harman, we recommend that you submit a prepared statement which will be inserted in the record at the appropriate place. Sincerely, Donald E. Richbourg ' Staff Assistant Foreign Operations Subcommittee Box 1090 Balbo*, Canal Zane March 26. 1977 To: Governor Harold R. Parfltt T'arou;h: Canal Jone Poliae Dirlslon Dsar Gorernor Parfltt: Pleas?? be assure* that I have taken Into very serious conslierw-tion our conyersatlon rejardlng wy request for tlae-off to testify at tiae Hui?.n Rlz'nts He*rina;s in Washinzton, a matter of ^reat eoncern to resl-l-o in the Canal Zone. As you loiow, I i».^e a oo««it«ent to the Canal Zone Cem^ral Labor Ur.i the Canal Zone Police Union and, nore recently, to a v<«uli-be refui;ee fr^ Pana-ia to represent their interests at these hearin^js. Dele:;at»s to the Central Labar Union, for instance, jjare their unanimous consent that I represent that organization 5is its Legislative Chairian. Ani whereas tht U.S. Gorerment lay lii:btly consider the life of the af »re!»ent ioned Panamanian, I cann»t. Moreorer, thirteen years ai;o I too'< an oat-h to ser the U.S. taxpayer first, the Ajenay sesond, and ay f?.rjily »r.4 ne third. ? believe »e , therefore, when I state th»t I cannot, in z^e< faith, deviate frort that oath or frca the coTtitnents mentioned . I must reluctantly submit to you my resignation effective 11:00 p./l. of :4?.reh 27, 1977' I add, however, that I expect t» return to the C>;nal Zone on «r about April 8, 1977, when I shall definitely apply for re- | instate^iant to ay present position in the Canal Zsne Police. I sin^erelyj hope that you will favorably consider ay application, * J I It siii»Hld 5» without sayinj, sir, that labor efflftials .-.nd eivir. | council leaders are very myeh acquainted wl:fch the extre:^© pressurer pre^*! beins applied to nejcate the deristRtinc thrust of theee hearings, In- | oluiinj even the saall part that I aiKht have in testifying. With sincer respeat, therefore, for your past considerations, I rewain WllliPB a. Dr«*Rcr.«al 29 11 223 Canal Zone Centnil^ Labor Union and Metal 'Trades Council, AFL-CIO Box 47 f^Balboa .Heights, C. Z. April 21, 1977 William R. Drummond, Chairman Legislative Committee P.O. Box 1990 Balboa, Canal Zone William F. Kessler, Chief Canal Zone Police Division P.O. Box M Balboa Heights, Canal Zone Dear Chief > Yoiir letter to me dated April 20, 1977 proposing to discipline me is in violation of P.C.P.M. regulations Chapter 751 i Sub- chapter 2, section 2-i^d. Since the action in question that I took was given to me by- right of the Congress of the United States, I have decided to file an unfair labor practice against the Company/Government. I malie the above statements so that you as a Company/Government official may be put on notice of my rights and the administrative action that I am taking to protect those rights. V/illiam R. Drummond 224 CANAL ZONE GOVERNMENT CANAL ZONE IN KEI'l V RFf FR to: Balboa Heights, Canal Zone May 3, 1977 CAPL Officer William R.. Drummond Through: District Police C( Balboa Police Station Dear Officer Drummond: My letter of April 20, 1977, which you received on April 20, 1977, notified you of my proposal to suspend you from duty without pay for five (5) workdays for unauthorized absence from duty. You were advised that you had ten (10) calendar days in which to answer the charge, either orally or in writing. You chose not to respond. I have reviewed all the evidence as outlined in the proposed letter, and I find the facts fixlly support your suspension. It is my decision, therefore, to suspend you from duty without pay for five (5) workdays, effective May 12, May 13, May 14, May 15, and May 17, 1977. You have the right to appeal this decision at any time after receipt of this letter but not later than 15 calendar days after the effective date of the suspension. Any such appeal must (a) be in writing, (b) be addressed to the Civil Affairs Director through me, and (c) state specifically the facts upon which your appeal is based. You may submit affidavits, statements or other evidence in support of your appeal. A copy of this notice and all related documents shall be placed in your official personnel folder. Please acknowledge receipt of this letter by signing, dating and returning the enclosed copy. Sincerely yours. W. F. Kessler Chief, Police Division Canal Zone Cciirrar Labor Union and Metal Trades" touncil, AFL-CIO Box 47i;^Balboa. Heights, C. Z. April 21, 1977 William R. Drunmond, Chairnian Legislative Committee P.O. Box 1090 Balboa, Canal Zone Gordon I-";. Prick, Director Personnel Bureau P.O. Box ?>I Balboa Kei^^hts, Csnal Zone Dear Vt, Priclct It is with deep regret that I ledge, throo^h this letter, ar. "Unfair Labor Practice" against the Canal Zone Government bas upon the following P.C.P.K, regulations! 711.S-'2a The Company-Government shall ncti (1) Interfere with, restrain, or coerce an employee in the exercise of the rights assured by this chapter? (6) Refuse to consult with a labor organization as required by this 226 -Page Two- chapter, . Specifically piarsTiant to chapter 711 # Subchapter sub- section 4-3 (Consultation Procedure) a. vn^on consul ta-tion shall occur . " Prior to establishing or modifying any T:;Glicv or procedure that is Y/ithin the scone of section h~l of thin cha-pter « raanag- ment shall initiate cor-sultation with labor organizations that have been granted recognition in the unit(s) of recognition involved, ** (emphasis added) Those sxesB affected under section ^1—1 aret (3) Labor- lianagement Relations (6) Leave Scheduling (?) Prodedures for handling grievances and appeals from adverse personnel actions. On March 25, 1977» acting as the Legislative Chairman of the Central Labor Union-Metal Trades Go'jncil, I vras refused the right to "leave" in order to testify at a Congressional Hear- ing schediiled to be held in Washing-ton, D.C. on ."'^■•ch 30, 1977. On April 20, 1977f I received notice that the Company/Govern- ment has proposed to discipline me for asserting the above right. As you Imow, the Company/Government has a long-standing agree- ment vrith the CL.U.-M.T.C, in grant i>Tg its representatives leave in matters such as these. No prior consultation was made in the repiidiation of this agreement. Further J soon after exercising the above right, it is my under- standing that labor and management entered into a subsequent agreement to resolve this matter to the best interest of both. The action taken by the Conpany/Govemment on April 20, 1977 has repudiated this subsequent informal agreement. (I repeat -Page Three- that it was management and not labor that broke this agreement.) Mr, Prick, I wish to point out I have used the term "right" rather than "privilege" for the simple reason that by statute the Co-jpany/jovernnent cnruiot refune any Hnnjil Zone resident from pr»?3enting a griGvance to the Trovamment", the Congress of the United States, regardless of whether that individual has been requested cr not. In zzy case the facts speak for themselfi I did taatify at the hearing in question. I base this asr^ertion on the Canal Zone Code, Title 1, Chapter 3, -Personal and Civil Rights section ^1. Rights and guarantees (3) "Laws abridging the freedom of speech, -—and petition the Government for a redress cf greivances are void . (em- phasis added) I wish to further assert that pursuant to P.C.P.M, regulations Chapter 751 » Subchapter 2. DisclT^l inar-r P aretic en GGctlon 2-^ Flxln ? the Penal t-r d. "Disciplinary action shall not be taken in any case whore the sole basis for it is the employee's exercise of rights granted by laiAf or regulation. " For the Co-.npany/ucv32mr:?-nt to now propose disciplinary action against me for exercising a right given me by statute, they not crn?.y deny me the rirht.i given rje by the agency, but they also deny me the rights given me by the Confess of the United States. I am requesting that you sue your office to effect the following i 1. Set this disciplinary action asidej and 22S — Pap:e Four- 2. PoCTually include the above rights in the P.C.P.r.'. (labor-inanat^einent chapter) so that other Canal eTrrployees will not be faced with the same problems that I havet and 3- I be given two days administrative leave for the tirne that I spent testifyin,?; before the Ap-nropriations Cornnjittee, 3Jid April 11, 1977, the date that I rcet v/ith Canal Zone management formally on this matter. Enclosed is a more detailed summary of events regarding; this matter. Sincerely yours. William R. Druranond IF-i 74211 March 28, 1977 The Honorable Harold R. Parfitt Cover rior, Canal Zone Balboa Heights, Canal Zona Dear Governor Parfitt: As elected leaders of U.S. citizens in the Canal Zone, we are most concerned that our people be represented competently and responsibly in local issues, and where possible, be represented in Washington, D.C, as well. William Drunmond was given the opportunity to represent us in the presentation of docu.'nented testimony in Human Rights hearings now being held^ in Washington. We believe that the denial of his request for leave vxithout pay was the direct result of pressure from the State Department. This nor^elected body of individuals consider Mr. Drummond a source of inritation in Canal treaty matters because he presents documented vievjs that do not jibe with their own views on Panama and the Canal treaty. We believe that Mr. Drummond 's hastily submitted resignation was a result of duress; he felt he had a duty to perform in representing us as the Human Rights hearings and yet ho did not want to be AWOL while in V/ashington. In view of the fact that Mr. Drummond went to tTOrk after submitting the resignation and that he did not sign an official resig- nation form, ve believe his resignation should be negated. In addition, . we request that he be placed on "leave without pay" status, something that is granted to other less controversial employees without incident. Our people believe in free speech and the free discussion of all sides of an issue. The State Department in this instance has attempted to stifle what they consider dissent. If their bureaucratic meddling is effective in this instance, in order to be rid of an "irritant", we will take this matter to the Legislative Branch of our government. In the meantime, as word of Mr. Drummond 's being refused leave is in circiilation, you can expect serious repercussions among the already restless Canal workforce. 2M) cc: Senator John McClellan Senator Strom Thurmond Senator Jesse Helms Con5;ressman John Murphy Confrressman Ralph Metcalfe Con?:res^;man Gene Snyder Congressman Robert Dornan Congressman Daniel Flood 231 Name 1. Morris /\m'tay 2. Wallace Campbell 3. William Cotter 4. Kenneth Madcn Public Witnesses Room Time 10:00 A.M. 10:10 A.M. 10:20 A.M. 10:30 A.M. - March 30, 1977 H-303 Remarks 5. Lois Van Valkenburgh 10:40 A.M. E. Carl fiarcy 7. Pn-mip Harr.an 8. John Bullitt 9. James Morrell 10. Chris Baker 11. Human Rights 12. Alan Rubin 13. Rev. Collins 14. Carmen Votav/ 15. William Drummond 11:00 A.M. 11:10 A.M. 11:20 A.M. 11:30 A.M. 1:40 P.M. 2:00 P.M. 2:40 P.M. 2:50 P.M. 3:00 P.M. 3:10 P.M. Executive Director, American Israel Public Affairs Committee' President-Emeritus, Foundation for Cooperative Housing, International President, The African-American Institute Chairman, Advisory Committee on Overseas Cooperative Development Executive Secretary, Citizens Committee for UNICEF Attorney, Representing U.N. University Director of Information, Canal Zone Non- profit Public Information Corporation Treasurer, New Directions Associate, Center for International Policy Director, Planning, Credit Union National Association, Inc. President, Partners of the Americas Office of the President, Special Assistant for Federal Relations, Georgetov/n University Overseas Education Fund, League of Women Voters Chairman, Canal Zone Central Labor Union - Metal Trades Council Legislative Committp** 232 It seems a little incredible to me. Mr. Drummond. I think it is, too. I feel that these employees have a right to be represented. Mr. Zeferetti. I don't think you should have to pay the penalty for being legislative chairman of an organization. I don't think there should be a penalty imposed on you if you represent United States citizens here. Thank you, Mr. Chairman. Mr. Metcalfe. Thank you, Mr. Zeferetti. The gentleman from Indiana, Mr. Hillis. Mr. Hillis Thank you, Mr. Chairman. To save time I would like to request that the Governor and his representatives be given an opportunity to submit for the record a written position of their side of the issue. Mr. Metcalfe. I don't know whether the Governor heard you, but you are making a request for unanimous consent that the Governor have an opportunity to give a written response to this question involving Mr. Drummond's trip. Mr. Hillis. Yes, to present their side. Mr. Metcalfe. Unless there is objection it will be so ordered. [No material was received at time of printing.] Mr. Hillis. Mr. Graham, I have a question: On point 16 which you brought up, which is a human rights point, as I understand it, perhaps you don't know, but how many people do you believe would actually be covered by this, or might seek priority admission to the States on this basis? Mr. Graham. Our biggest concern here was the Canal Zone police who are affiliated with the Central Labor Union and Metal Trades Council. These people at the present time are being called traitors. I think there is a word called "venda patria" or something of that nature, as a result of their jobs with the Canal Zone policemen. As a result of their jobs as Canal Zone policemen, with the emotional issue over sovereignty, these people are in completely bad shape. If the United States leaves, it is very likely that these people could face a little bit of trouble. Outside of the police department there may be others but that was the crux of our argument here, it was the Canal Zone police. Mr. Metcalfe. Thank you. Mr. Modglin. Mr. Modglin. Just one question, Mr. Chairman. Do you concur with the other groups of organized labor who have excepted themselves from this concept as presented in the assur- ances of some guarantees for United States citizens and other guarantees for non-U. S. citizens? Mr. Graham. We always support guarantees for all employees. There is no question about that. Whatever guarantees are given to one, if it's legally possible, should be given to the others. Mr. Modglin. That is all, Mr. Chairman. Mr. Metcalfe. Thank you. Mr. Nonnenmacher. Mr. Nonnenmacher. Thank you, Mr. Chairman. I would like to address a brief question that I hope Mr. Drum- mond can briefly answer, in view of your restrictions on time, Mr. Chairman. To put the question generally on an earlier point I raised on the subject of Communist infiltration in the labor movement on the Isthmus, in the Canal Zone or in the Republic of Panama, could you, Mr. Drummond, give us what your personal opinion is — not your opinion but the facts that you may have ascertained in your duties as a policemen. I don't mean confidential material. Both as a member of the police force, and as a member of the labor movement in this area, do you have any knowledge of any extensive Commu- nist infiltration into the labor union movement, any labor organiza- tion, any labor union whatsoever? Mr. Drummond. I cannot give a precise figure on the infiltration of the Communist movement in Panama in the labor forces. 1 feel it is extensive, based on my experience in the labor force for five years. I believe that the Minister of Labor, Mr. Ahumada, is considered to be a Communist. I don't know if he is a professed Communist. In the banana region of Panama it is a well known fact that it is deeply infested with Communists. I have been given quite a bit of information, some formal, some informal, that the Communist movement is increasing in Panama and I assume it is also increasing in the labor move- ment, and I am talking about both formal and informal documentation. I would be glad to furnish a later date to the committee if they care to have it inserted in the record. Mr. Metcalfe. I think it very important Mr. Nonnenmacher, that this matter be included because his answer is only his opinion, and it needs to be documented. Let the record show we will welcome such substantiating testi- mony from you, Mr. Drummond. Mr. Nonnenmacher. I would only like to add an addendum to that request. The former chairman of the full committee, Mrs. Sullivan, was quite concerned with any Cuban influence anywhere in the Republic of Panama, and I would ask if you have any new iformation in that area, if you will provide that also. That is the only question I have. Mr. Metcalfe. It is so ordered unless there is objection. [The information referred to follows:] 95-549 O - 77 - 16 234 April 2k, 1977 STATEraNT CF WILLIAM R . DRUKiMOND LEGISLATIVE CHAIRyiAN OP THE C .L. U .-M.T . C . r.*iADE TO THE HOUSE PANAMA CANAL SUBCOIViMITTEE IN RESPONSE TO THEIR INQUIRY OP COYI^IST INFLUENCE IN THE PANANIA LABOR FORCE. Dear h'sr. Chairman: In reply to the subcommittee"s request to supply them further information on the Conimunist movement in labor in the Republic of Panama, I have enclosed the following analysis i At the Panama Canal S ubcomjiittee hearing held on April 13» 1977t in Balboa, Canal Zone, I stated that the f-'.inister of Labor and Social Welfare, Adolfo Ahuraada, was a well knovm Communist and that, in the area of the banana plantations, the conuctmist iDOveaent is known to predominate. I further stated that this movement has been progressive over the last eight years, becoming more and more viable. To be sure, only a very small percentage of the labor force in Panaina can honestly be considered idiological communists. Even less can_ be recognized as professed communists. This is due to the fact that the vast majority of Panamanians are anti-communist. This being the case, you may v.'onder how it is possible for the commu:iists to have control of a large protion of the labor force within the Republic? The ansv.-er is si.T.pie. They offer the employee a better deal and for the last gj.^ht years they have been able to come thro'JS^' on 235 their prcaises. The coirjnvinists have, since 1970, taken up each labor benefit, before it was implemented, as their own, preerrpt- ing their competition, and they have had the full support of the Minister of Labor, in liege with Romulo Escobar Betancourt, Spec- ial adviser to General Torrijos, and Juan V:atemo Vasquez, Chief Jiistice of the Supreme Court, to help push the government into inrplenienting these benefits. In several cases, along with the Ex-Minister olf rLabor, Dr. Rolando I>:urgas and author of the new labor code, Minister AhrnnaQa is personally recognized as the spon- sor of these benefits. I'inister of Government and Justice, Jorge Castro has helped to enforce these labor benefits upon industry. The Panama governnent, in turn, was able to gain support of their ovm objectives as long as the work force could be satisfied. The leacership of the different Unions in Panama went to those persons, coranvmists and/or opportunists, who had the ear and sup- port of the Labor and Govemment ministries. One clear ejrample of this partenership can be found in the person- age of Doniingo Barria, a v/ell kno-.vn Corarai^nist Union organizer. I-5r. Barria masterninded the one large Central Labor Union in Panama, now called the "Central De Trabajadores De Republica De Panama. (C.T.R.?.) V/ho in labor can argue against a v/irming combination such as this? Benefits for all; a chicken in every pot. All one need do is de- nounce iraperialisni, the oligarcgy, fachisra and of course the Canal Zone. Let me give you just a fev/ examples t A. On February 28, 1975. 'J-. Barria participated in the Permanent Congress of Latin American Workers Union Unity (CPUSTAL), a communist front activity. Over 20 countries participated in this Latin A-er- ican reunion, including representatives from as far away as Palestine. 236 Dr. Rolando r.:urgas, Ex-Minister of Labor, opened the session. The Panama dele;;ation consisted ofi 1. Central National de Trabajadores Panarr.enos 2. Federacion de Trabajadires de Prensa , Had io , Cine , Teatro, Television y Espectaculos , de la Central Istmena de Trabajodores 3. Confederacion de Trabajodores de la Republica de Peinama del Consejo National de Trabajadores, Organizadas de la Republica de Panama (CCNATO) 4. Federacion Sindical de Trabajadores de Panama The deligate from Cuba, Roberto Vega, spoke in the name of the full Congress of Latin American Workers Union Unity (CPUSTAL) Juan Campos spoke for the "Federacion Sindical Kundial". Domingo Barria spoke for the "Central National de Trabajadores". Comrriunist Russia also participated in covering this function that was held in Panama. (See news article #1 enclosed) In the "r.":atutino", 7-26-75 an article entitled "Acts in Honor of Cuba", appeared. The Cuban Ambassador is shov/n addressing a group organized by the "Anti- Fascist Comnittee", a communist front organization, in a "Political-Cultural Act". The past Rector of the Panama University, Dr. Roraulo Escobar Bethancoiirt , is identified as presiding over the "Anti-Fascist Com- mittee, "and in fact is one of its founders.' Domingo Barria also addressed this group. (See article 772 in the "EstrtJ-la de Panama", 3-19-77 an article appecred in which the communist front organization "CONADESOPAZ" takes up the cudgel of Race Discrim- ination. In this article, Panama is attempting to distort treaty related items as racial discriminat- ion against Panamanians. The celebration is "In- ternational day for the elimination of all forms of discrimination". Dr. Pedro Br in ^artinez, a member of the U.N. com- mittee for the ellimination of all forms of racial discrimination was a featured speaker at this rally. Kis connection to Canal Zone labor becomes clear, when one studies this recent Panama U.N. protest. (See ex- aple #3) In the "EstrClla de Manama", 3-17-77t an article appeared entitled "Council of Peace had a meeting here". "In a simple but solemn act various professional, farmer, v-'orker . student and civic organizations met . at the "House of Journalists" on the 15th of f'^^rch. The meeting was held to salute "Dr. Samuel Zivs", Vice President of the Soviet Jurists Association and Nath- aniel Kill, piermanent representative for Latin America before the World Council of Peace. Dr. Ca!oilo 0. Perez, a well known communist in Panama, and the President of "CONADESOPAZ", the Panama com- ponent of the V/orld Council of Peace, a soviet organ, spoke at this meeting. Ironically, Dr. Perez v/as a recent recipient of a State Department grant. Also mentioned at ths meeting v;as Carlos Wong and ?rofes6r Pedro Lov/ana, members of the "Frente do Tr aba jad ores de la Cultura". (See example rf^) 238 E, In the "Dominical", k-2k~77 an article appeared entitled "Concentracion obrera en Puerto Arrauelles", Labor Rally in Puerto Armuelles, the so-called banana plantation area of Panama, is set to celebrate I-ay 1, 1977, In- ternational I-abor Day. Pulg^cio Castillo, a member of the "Federacion National de Trabajadores Panamenos" and the "Comite Permanente de Unidad y Defensa de los Intereses Populares de Chirique", will sponsor the organization of this rally. (See example #5) P. In the "Star ^Herald", 4-23-77 an article appeared entitled "New Union Chief to be Installed". This article indicates that there v/ill be an installation of new officers of "Panama's National Federation of Democratic Workers". Minister of Labor, Adolfo Ahvimada, and other top gov- emnent officials and- Unions were in attendence. Luis A. Anderson, Secretary General of Local 907, .A. P.S.C.;.:.E. , the U.S. Armed Forces V/orker's Union in the Canal Zone, v;as installed to replace Gerardo Mendez as the Chairman of the Federation. "The Federation also forms part of the powerful Panama Workers Federation". (See example #6) The above news articles are, of course, only a very small sample ^ of the "Part)|nership!* created betv;een Labor, Government, and the Co:Lrrur.ist objectives in Panama and the Canal Zone. Not all participants are professed communists. However; if one helps perpetuate the goals of that organ, does it really matter? The United Nations has, in its International Convention on the Elimination of All Forms of Racial Discrimination, Fifteenth session, dated 1,'ovember 3, 1976, reprinted the essential laws 239 governing *trade Unions within the Republic. (They are included in this writting for easy reference.) It should be carefxilly noted, in this reference, that all trade mien activities in Panama exist at the discretion of the Panama government. It should also be noted that the charges and allegations contained in this docximent are the latest examples of the consistent systea used by the Panaraa government in which it has destroyed and/or taken over various private enterprises within that country. In almost every case industrial . earnings are restricted or frozen by government decree or by supply and demand. The government then encourages employee demands for increased wages and benefits. The government steps in as the employee's champion and arbiter. V/hen the part- icular industry cannot financially meet these demands, the government assxunes control at a. fraction of the value of the industry. The generally poor economic trend in Panama has been caused, to a great degree, by the above circumstances. Enclosed is a recent example of this problem: On April 24, 1977i I'i*. Jativa, a Panamanian, presented himself at the Balboa police station, ^x. Jativa is . the ov.-ner of a tool shop in the Republic of Panama. He stated that he could no longer tolerate the economic pressures put upon him by the Panama Government, and he fvLTther stated that he v/as not seeking political asylun, but that he v/as not leaving the police station urjtil he v.-as locked up. He persisted in his der.and, imtil he v/as arrested for disturbing the peace. That evening, his v/ifc tried to get him to leave, but to no avail. h'e refused to 3 cave his cell. 240 Obviously t on the v/hole, most biisinessmen in Panaina do not take the same coiirse of action as I^r. Jativa, however; this man's case is not tmusual. Last year alone, many hundreds of businesses in Panama were taken over, or went bankrupt because of the Panama government's labor and business policies. Many past examples nay be ginen to substantiate these facts, but none of more importance to the United States than the one that is unfolding in the U.N. today; the Canal enterprise is the obvious target. Compare the circumstances that have evolved in the U.N. claimes made by the Panar^. government against the Canal Zone agency, and the Panama take-over of the Boise-Cascade seisure of 1972, (The specificity of this seizure may be formed in the House Panama Car.al Subcommittee hearing report No. 92-1 629)' In both of these cases, the labor force is used to put forth clair^ against a particular industry. Also, in both of these cases, if history is any indicator, there is a clear lack of forceful action by our Executive Branch to protect the interests of this industry as the problem begins, and as it evolves. The tools for this protection is clearly outlined in these House hearings t 1. "Subcommittee inquires prior to the Jxily-Aiigust ■ hearings on the Boise-Cascade seizvire indicated that ^ there v.-as ample evidence that the State Department al- lowed violations of the spirit and intent of President Nixon's policy. on expropriations outlined in a state- ment c: January 19, 1972." "There was also evidence that the State Department per- mitted violations of the lav.-s of the United States by not exercising its responsibilities in ths case." 241 "The Congress expressed its position in these matters in a law passed in I'a^rch of 1972, which concerned it- self with loans approved by the Inter-American Develop- ment Bcink. This law stipulates that the United States wotild deny loans to any country which had ex-pro-priated or seized ovmers hiT? or co ntrol of oronertv ov/ned by any U.S. citiaen or Corporation." . 2. " The Provisional Junta Government of Panama, according to the authors of this law, repudiated or nullified their contract with that company ir.akinr^ them ineligible for American suo-ported financial losms." Ironicalli/; the Chairman of that House committee v/ent on to state: " If Boise-Cascade is not receiving the full sup-port of •^he American Goverr.T.c-nt and its rights under internat- ional lav/ •are not beirT observed, this r.av be only the beginning; of a scries of seizures bv the Provisional Junta Government of Fanair.a v/hich could ultimately deter- iorate United States control and o-peration of the Panama Canal . " Kovr reflect, if you will in 1977, the active part that I^r. Anderson, Chairinaji of the "Federation of Panaica's Democratic V/or>ers", and Secretary General of Local 907, A.F.S .C.ri.E. , an afiliate of the A.F.L.-C.I.O. , played in Panan:a's protest to the U.t;. against discrimination within the Canal Zone. Fron: personal knowled^-^e , I arri aware that this organization has )Deen, for at least the last year, \jrposfully soliciting Canal Zone c--ployee grievances, and turning then; over to the Pananva Labor and Foreign Ministries. It should be obvious now, after the p'jblication of this U.'.'. protest, for v/hat use these f:riev- ances v. ere to be used. I v;ish to point out here, that during this same period, I had on several occassions brought- this problem, and its solution to the attQri4:ion of the Canal Zone Company/Govcrnn;ent . 242 I submitted one case to this subcommittee last year, in which the grievant had been approached, on several occassions, by these same people for just such a p\irpose as described above. terested in stilving his problem and not in being used. Also reflect, if you will, that all of the above is jxist a minute example of what our country can expect from the Panama government once it is installed as a partener in the Csmal enterprise.- This then is the direction that the communist movement in the PanajTia Labor force is headed. It is the same direction that this leftist Panama government is headed. The question should not be asked "what degree of strength does the conntjnist movement have in the labor force in Panama". Rather, v/e shovild be asking, when is our Executive Branch going to forcefully protect U.S. interests against this leftist con- trolled Panama government. Enclosed is a list of Inter-American Developement Bank Loans that have helped these people to carry out thier objectives against United States interests in this area. Also encloped is a single example of the type of propaganda used against us. Fortuna"^!!^^ for the Company/Government, this grievant was in- Respectfully subnitted V/illiam R. Dr\imir:ond 243 Mas de veinte paises en Congreso de CPUSTAL • 71 ie febrero a las • 6:30 p m., en el Palacio ! Legislative Justo Arose- i mena en la ciudad de Pa- ' nami, fue inaugurado por ' S.E. Dr. Rolando Murgas, MiDistro de Trabajo y Bienestar Social el V Con- «ejo del Congreso Perma- ■ nente de Unidad Sindical ; de los Trabajadoro.; de - America Latina, (CPUS- TAL), con la participacion de delegados obreroj d« Argentina, Bolivia, Bra- lil, Costa Rica, Cuba, Co- lombia, Chile, Ecuador, El Salvador, Guayana Francesa. Gu at e m a 1 a, Guadalupe, Honduras, Mexico, Mirtinica, Nica- ragua, Panama, Peru, Re- publics* Dominicana, U* ruguay y Venezuela. Tam- bi^ asiste la representa- ei6n de los trabajadores de Puerto Rico y de Pa- kstina. En la scsi6n inaugural asistieron 500 personas entre funcionarios del Go- bierno Revolucionario, en- tr» cllos el Lie. Damian Castillo, Contralor Gene- ral de U RepiibUca, dele- fados fraternales de la Central Nacional de Tra-- bajadores Panamenos, Fe- deracion de Trabajadores de Prensa. Radio, Cine, Teatro, Tclevisibn y Es- pectaculos. de la Central Istmena de Trabajadores, Confederaci6n de Traba- jadores de la Eepublica de Panama, del Consejo Nacional de Trabajadores Organirados de la Repu- blica de Panam^, (CONA- TO), Federacion Sindical de Trabajadores de Pana- (P«aa • U Pig. 10, No. 101) i 201- mi, miembros de la pren- sa, radio y television de Par*am4 y de paises de America Latina y la U- ni6n Sovietica. El dele ?a do de la Cen- tral de Trabajadores de • Cuba, Roberto Vega, ha- bio a nombre de CPUS- • TAL, el dirigente Juan Campos lo hizo a nombre d*» la Federa'-'on SmHiroj- Mundial y «] dirigentfl Domingo Barria a nom- bre de la Central Nario- ' nal de Trabajadores Pa- namenos. El 28 de febrero se e- lectuo sesion plcnaria de 8.20 a.m. a 12:30 p.m. e hizo u.vo de la palabra el delegado de Puerto Rico^' el del Guayana, El Salva- dor y sc nombraron las comisiones de trabajo. De 2 a 3 p.m. el Sr. Contra- lor de la Republica, Lie. Damian Castillo, recibio a los delegados de CPUS- TAL. El congreso de CPUS- TAL ser4 clausurado a las 12 m*»ridiano del do- mingo 2 de mzrio en el Paiacio Legislativo y a ^este acto se invita a los funcionarios del Gohier- no Revolucionario. miem- bros de la pren.<;a. radio, televi.sion y a todos los trabajadores eii general. 244 ACTOS. . . •i i El Dr. Pedro Gonzalez Pineiro Embajador Enc&rgado deCiiba en Panama, durante su intervtiw Cion en el acto politico-cultural organlzado por el Comlte Naclonal Antt/jsclstas de panairii en el Paranliifode la Unlversldad de Panama, en conmemoraclon al XXII anlversarlo del A- salto al Cuartel Moncada que niarcoel Inlcio de la revolucton cubana. fOS mt "El Moncada nc solo marca cl cairJnode la Independencla naclonal y la lltcraclon para pueblo de Cuba slno quo ahrlo una nueva etap.i en cl doveiilr de nuestros pueMos y n-.ostro una vez mis que no Importan cuJin rf'liiefio sea usi (mTs cuando se dispone a luchar por el blenestar de su pueblo, pyr el rcs^ cate de sus recursos naturales y la plena soberanfa'naclonaU" As! cxpreso en parte de su dlscurso del Dr. Pedro ConzSlez Pineiro, Emba- jador Encarjado de la Re- piibllca de Cuba en panami, al agradecer el acto efec- tuado el jiieves en la r.oche en el paraninfo de la Unl- versldad de Panama, con motlvo de la celebraclon del XXII Anlversarlo del asalto al Cuartel Moncada en Santiago de Cuba. El acto f lie oreanlzadopor Comlte Naclonal Antl- (asclsta de pana ma, qije pre- side el Rector dc la Unlver- sldad, Dr. Koniuio Esco- bar Bethancourt, para con- memorar tamblon un anl- versarlo niiis de la batalla del Puenle de Caltdonla. El del Jiieves en la n.oche fue uno de los actos proera- mados por el Comlte Naclo- nal AntUasclsta de Panama. Durante la manana se h^bfa llevado una romerfa al bus- to de los aposteles \iaceo y Martf, en la Plaza porras. Domingo Barrfa d^ la Cen- tral Naclonal de Tratajado- res, hlzo uso de la palahra en el acto politico-cultural celebrado en el Paraninfo de la Unlversldad. El Rector de la Unlversl- dad de Panama, Dr. Esco- bar Bethancourt lo hlzo por el comlte organlzador. Du- rante su Intervenclon desa- rrollo una exposlclon que de.staco la herolca partlcl- paclon de Vlctorlano Loren- zo en la balalla del Fuente de CaMtivnla, hace 70 anos.fe- cha en que losaconteclmlen- tos hlstorlcos hlcleroncoln- cldlr paralelanente co.i la gesta del "Moncada". Dljj cl Rector que era J Importante scnalar que hace 75 an OS en pie no corazon dc nuestra cludaJ, a las faldas del Cerro Aiicon, una Juven- tud herolca, la juventud pa- namena, se lanzo alcomlw- te hasta la niuerte, con el fln.de lograr R-.ejores dfas iwra el pueblo panameno. (Paca e lo Paq. 6-B) '^iinisterio de Hai CONTRIBUYENTE EL EL PLAZO PARA PAC SIN RECARGOS. Nl INI Valoro el «pon« rle la rc- volucl6n cubana a U luchi contra cl ImperUllsmo jr quedCi plasmada la solldarl- dad y la bermandad cubano- panameA*. En su turno, el Dr. C'jn- zilez Pli^elro al hacer iit rccuento hlst6rlco de la lu- cha llhertarla del putblocu- bano manifesto: "Cviba fue el (iltlmo de nuestros pat^s que «e lltxrro d<- l yuco colo- nial, tras la glorlosa gue> rra dc los Die? Aftos, Irl- clada por Carlos Manuel de Cespedcs cn 1868 y rea. nudada en 18C"; con renova- do vigor bajo la s^bla ca-,- ducclon 6e nuestro Apostol Jose Martf." Contlniia el Dr. Conzilei Pineiro con el recuenlo his- toric o y senala que "en el ano 195 3, sno del Centena- lio del Apostol, la sltuadon en nuestro pals pasaba por uiia -Je las eLap2s mis oscu- ras para r.jestro puehla" Contlnua dlclendo: "st produce el 26 d? Jullola ges- ta de Moncada. Un punado de Jovenes se dlspuso a to- mar el cuartel Moncada en SantUgo de Cuba, caplul de la provlnclade Orii.-.te, tu- na de la revoluclon en nues- tro pais. Ya en la parte final de su dlscurso d! Jo el Err:balador Encargrido dc C'iba en Par a. mi.; "cuando aq-jlen Vi-si- mi recordumos a los heroes que sucuinbleron ante los muros del Cuartel Moncada, reaflrmamos tainblen cl de- recho de vue-stropucblo a al- canzar la soberar.fa plena sobre su principal recurso natural, el Canal dc- par.ami 7 a extlrpar defl.-.ltlvamente la presencla coIorJilli ta de Estados UnlQos en parte de su terrltorlQ," Termlno el Dr. GoniSlez PLnelro a los Titos dc; 'Tl- va el 26 de JuJlc, jlorlaeter- na a los heroes y mirtlres del Moncada, Viva la iucha del pueblo panameno por el rescate de la soWrarJc en la llamada Zona Canal." Despues de las tp.terven- clones dc los oi idores sc de- sarrollo un especticuloar- tfstlco que coTilo con la par- tlclpaclon de la Ijanda He- publlcana, Ssntos TJfaz ylos Cantores del Pueblo, Ita- lo Dlcardl y el Taller So- noru Victor Jar a. 245 LA ESTRELLA DE PANAMA — Sabado. 19 de Marzo de 1977 Tacmk lo Dia Interiiacional de Discriminacioii Racial Con el patrocinio del CONADHSOHAZ.laCasa del Periodista servira de marco. para la celebracion del "nia Iniernacional para la Eliminacion de lodas las F o r m a s d e Discrimi.'iacion". con la abistcncia de Su Excelencia Doctor Carlos Ozores Typaldos, Viceminist^ro de Relaciones Exleriores, entidad estatal quo. siguiendo los preceplos establecidos en la Convencion Internacional que rigc esta materia, ha organizado una serie de actividades tendientes a resaltar tan singular fecha. En el mencionado acto sc premiar a a los ganadores en el Concurso de piniura, donde participaron diferentes artistas nacionales con afiches alusivos a la fecha y en el que resulto triunfador el joven pintor panamerio Kdgardr Lamparero, haciendcse acreedor a la suma de trescientos balboas. donados por el Ministerio de Relaciones Kxteriores. En segundo higar fue escogido el afiche presentado por el conocido pintor Hermenegildo Zaldi'var, cuyo premio sera de.ciento cincuenta balboas, donado por la Caja de Ahorros y, el tercer premio, lo merecio la obradel pinlor nobcl Carlos Rodriguez. El jurado de este concurso estuvo compaeslo por conocidos pintores panamenos. cncabezados por Mario Calvit y Alfredo Sinclair, con la colaboracion del Licenciado Sebastian Quiros, represenlante de la Caja de Ahorros. Los organizadores de estas actividades conmemorativas a tan importante fecha que se guian con los pro;^rarn,is de Naciones Lnidas para realzar, ademas el Decenio contra el flageln de la Discriminacion Racial en el Mundo (1973-1983) son los distinguidos profcsionales Lie. Pedro Brin" Martinez. Director del Deparlamento de Org'anismos. Conferencias y Tratados Internacionales y Miembro del Comite de Naciones L nidas para la Eliminacion dc todas las formas de Discriminacion Racial, las Licen'-' as Aminta Quijada Dra" ..iaria Isabel (iuardia d"" arin, del Ministerio de .laciones Exterioiej; y el Seiior Carios Nune/, miembro de la CO.NADESOPA/. quienos ban preparado el .-.iguiente programa en alusion a la fecha: 1. Apertura del Acto por la Licenciada Maria Lsabcl Guardia de .Marin. 2. Palabras por el Senor Luis Anderson, Secrctario General del Local 907. 3. Intervencion Musical. 4. Intervencion de un delegado del CONADESOPAZ. 6. Palabras por el Lircticiado Pedro Brin Martinez. 6. Premiacion a los ganadores del Concurso dc Cartelcs p->r ei Doctor Garlos Ozores Typaldos. Viceministro de Relaciones Exteriores. 7. .Actuacion del ' Teatro Popular" de DIGEDECOM. 8. ExposicioM de Afiches. 9. Brindis. El acto tendra lugar en la Casa del Periodista. a las -.00 p.m. Glenn F< 246 LA ESTRELLA DE P4NAMA - Jueves. 17 de Marzo de 1977 Consejo de^ la Paz tuvo reunion aqui En un acto sencillo pero solemne, varias organi- zaciones profesionales, campesinas, obreras, estudiantiies y ci'vicas se dieron cita en la Casa del Periodista el dia martes 15 del presente mes, para saludar a los senores Dr. ,- Samuel Zivs, Vicepresidente dela Asociacion de Juristas dc la Union Sovietica y al' Ucenciado Nathaniel HiJl, Representante permanente • por America Latina ante el Consejo Mundial de la Paz.' Las d04 distinguidas personalidades hacen un extenso recdrrido por este continente.para promovery expbcar todo io relacionado con el proximo Congreso del Consejo Mundial dc la Paz, que se celebrara en' Varsovia. Ademas de las organizaciones asistentes, acompanabana los visitantes el Dr. Camilo O. Perez, Presidente del CONADESOPAZen Panama; el Reverendo profesor de la USMA. Pedro Lowana y el poeta Carlos Wong,, miembro prominente del Frente deTrabajadoresdela Cultura. El doctor Samuel Zivs tomo la palabra para fclicitaral pueblo panameno - por sudenodada lucha por el - rescate de su plena sobcrania en la Zona del Canal, bajo la gui'a' revolucionaria del li'der maximo del proceso. panameno, General Omar TorrijosHerrera. rxpUcoel Dr.. Zivs la trascendencia . que tiene para la humanidad " la celebracion del Congreso Mundial de la Paz en Varso\Ta, precisamente ahora que se cclebra el 60 Aniversariode la Revolucion Sovietica y otro aniversario dela derrota del fascism© en Europa. ^' El Dr. Camilo 0. Perez ilustroa los asistentes sobre el trabajo que viene realizando en Panama el CONADESOPAZ.que agrupa a todos los hombres, sin distingo, de raza, color, religion o c redo politico en el aXande lograrque la paz sea un hecho cierto come vital • ingrediente para el ' desarrollode las naciones y pueblos del mundo. Hizo un Uamadoa findequeel mayor numero de panamcfios . Pua > U Pif. 11, No. 113 . 113 Grmcn el "Llamado dc Estocolmo", que en su esencia reclama la paz .mundial a traves del dcsarme general. El Dr. CamiJoO. Perez destaco que Venezuela y Panama son las narioncs latinoamericanas senalad;)s para redactar un documcnto sobre nuestro conlincntc cn cl mcncionado Congrcso.y agrego que Ja Delegation panamena asislcnteal conclave, a mas de que sera intcgrada por hombres rcprescntantes de todos los estratos socialesy profesionales, debcra prcsentar cl documento sobre Panama, relacionado con nucstra lucha por el rescate dc nuestra soberania en la Zona del Canal, lo cual constituira un alto honor para Id delegacion.ya que se espera en Varsovia la asistencia dcmasde dos mil delegados de todo el mundo. El Doctor Samuel Zivs seguira con destino a la hermanaRepublica de Costa Rica, cumpliendo igual minion yde alii seguira viaje hacia la ciudad de Nueva York. Mientras tanto, la CONADESOPAZ se prepara para llevar a cabo unh reunion amplia en la Universidad Santa Maria la Antigua, relacionada con el mcncionado congreso. La fccha dc esta reunion se avisara oportunamcnte. 1 14, - 247 Dominican-La Republica-Domingo, 24 de Abril de 1977 Cosiceiatracidn obs'era en Puerto Armueffes DAVID (Por On^simo LezcaAo)— Ser^ en la clu- dad de Puerto Arimielles la magna concentracltfn o- brera del lo, de Mayo,Dfe iiternaclonal del Trabajo seg^In declare en nuestra redaccl<5n el dlrlgente Ful- genclo Castillo, qulen in- dict que la ConfederacMn Naxjlonal de Trabajadores Panaraefio-s y el Comit^ Per* manente de Unldad y E)e- fensa de los Iniereses Po» pulares de Chirlquf, se han responsabiUzado absoluta- mente por la organlzad&i de dlcbos actoSy queconta^ rffn con delegaclones eo- peclales de todos los pun- tos de la provliicia proc&- dentes de Slndlcatos, A. sentainienios Campeslno6 LJgas AgnrisLS, Profeslo- nales, estudiantes y otros grupos representatives de la comunJdad provincial. El St, Castillo nos de- clar^J asf mis mo, que am- bas Instltuclones estAico- ordlnando todo lo relacio- nado a transporte y aten- cl&i a los partlcipantes en la concentracMn, Has* ta el mo mentodeclarij Cas- tillo funglr^ como ora- Fusicionarfoseuboiios devlsita en Chirlc|ui DAVID (Por OnSsi mo Lezcano).- Altos dirlgen- tes del Comllede Oefensa de laRevoluclonCubana vi- sitaron esta provlncia e! pasado fin de semana en companra del Vicepresi- dente Encargado de laPre- sidencia de la Aaamblea Naclonal de Repreaenlan- tes de Correglmientos y » otros altosfuncionarlosdel organlsmo legislative. Los distlngutdos visi tan- tea senores Jo.. SATIHDAY, APRIL 23, 1 977 New Union Chief To Be Installed The new officers of Panama's National Federation of Democratic Workers will be •installed tor.ini'.l, in ceremonies to be hcM in the session hall of the "Ccntro del tlucador," loc.ilcd at the corner between Harry Eno and Capitan Posada Streets in the Industrial Devcloprr.cnt. Attending the cercmonip:, which c«l underwny at 7 pm , wUl be the Minister of Labor and Social Welfare Adolfo' Ahu,Ti£(ia. oUier to,> government ofiicials, representatives of private companies and local unior.s. To be installed as chairman ii Luis A. Andersen, Secretary Gencril of Local 907, Armed Forces Workers Union, who re- piai-cs Gerardo Mendez. The N.itional Fi dcration of Democratic V. orkers is formed by several local ujiions iJicludin? Local 507. The Fcdcrstioii also forms pari of the prvcrful Panama Workers Ferfprstion. 249 page 24 The indig-enous people of the country are free to use their mother tongue in their relations with one einothor. Even at their congresses, held with the assistance of government authorities, the indigenous language is widely used, and interpreters into Spanish are provided. Schools form the exception, because Indian students are generally prohibited from using their own languages in communicating with one another. It is claimed that this measure, which compels the child to use Spajiish, helps to achieve better training in the language. ARTICLES OF THE 1972 POLITICAL CONSTITUTION INSTITUTING A NON-DISCRIMINATORY SYSTEM OF £^PLOY^ENT IN THE REPUBLIC OF PANAI'IA Article ')9 » V/ork is a right and a duty of the individual; hence, the State is obliged to elaborate economic policies designed to promote full employment and to ensure to every worker the necessairy conditions for a decent existence. Article 60 . All workers in the service of the State or of private or public enterprises or of private individuals shall be guaranteed a pinimum wage or salary. Employees of enterprises specified by law shall participate in the profits thereof, in accordance with the economic circumstances of the country. Article 61 . The law shall specify the methods for periodical adjustments of the minim^on wage or salary for workers, in order to meet the ordinary needs of the worker's family and to improve its standard of living, in accordance with the particular conditions of* each region eind of each economic activity; it may also determine the method of fixing minimum wages or salaries for each occupation. In the case of piecework, the minimum daily wage shall be guarajiteed. ,The minimum wage or salary may not be seized, except in the case of obligations of support, in the manner prescribed by law. Similarly, a worker's tools or equipment may not be seized. Article 62 . An equal wage or salary shall always be paid for equal v/ork under identical conditions, regardless of the person who performs it, without distinction as to sex, nationality, age, race, social class or political or religious ideas. Article 6'^ . The right of association shall be recognized for employers, wage-earners and professionals of all classes for the purposes of their economic and social activity. The Executive shall have an unextendable period of 50 days to approve or reject the registration of a union or association. The law shall regulate all matters pertaining to Executive recognition of unions or associations, whose legal personality shall be determined by the registration. >r The Executive may dissolve a union or association only when it deviates permanently from its purposes and the competent court so rules in a final judgement. The governing bodies of such unions or associations shall consist exclusively of Panamanians . 95-549 - 77 - 17 250 CERD/c/8 pa^-e 25 Article 64 . The right to strike shall be recognized. The law shall govern the exercise of this right and may malce it subject to special restrictions in public services which it shall designate. Article 65 . The maximum working day shall be eight hours, with a working week of up to 48 hours; the maximum duration for night work shall not be more than seven hours, aind overtime shall be paid at a higher rate. The maximum working day may be reduced to six hours per day for persons over 14 and under 18 years of age. V/ork shall be prohibited for persons under I4 years of age, and night work for persons under 16 years of age, except in cases specified by law. The employment of persons under I4 years of age as domestic servants and of minors and women in unhealthy occupations shall also be prohibited. In addition to the weekly period of rest, all workers shall be entitled to paid holidays. The law may prescribe a weekly period of rest paid in accordance with the economic and social circumstances of the country and the interest of the workers. Article 66 . All stipulations which imply a waiver, diminution, impairment or relinquishment of any recognized rights of workers shall be null eind void and, consequently, shall not be binding on the contracting parties, even if they are expressed in a work contract or any other agreement. The law shall regulate all matters pertaining to work contracts. Article 67 . iTrotection shall be afforded to working mothers. A woman who is pregnant shall not, for this reason, be dismissed from her employment, whether public or private. For a minimum of six weeks preceding the birth of her child and eight weeks thereafter she shall have compulsory leave with the same remuneration as she was paid \fhile working end shall retain her employment and all the rights provided for in her contract. Vhen the working mother resumes her v/ork, she may not be dismissed for a period of one year, except in special cases prescribed by the law, which shall also govern the special conditions of work for pregnant women. Article 68 . Hiring of foreign workers which may lower the working conditions or living standards of Panamanian v/orkers shall be prohibited. The law shall govern the hiring of foreign managers, administrators and executives, technicians and professionals for public and private services, preserving at all times the rights of Pcmamanians in accordance with the national interest. Article 69 . No worker may be dismissed without just cause and without the formalities prescribed by law. The law shall specify justifiable causes for dismissal, special exceptions and the compensation payable. Article 70 - The State or private enterprises shall provide workers with vocational training free of charge. The law shall prescribe the manner in which this service is to be provided. Article 71 . Trade union training is hereby instituted. It shall be provided exclusively by the State and by Panamanian trade union organizations. Article 72 . Any disputes arising in relations between capital and labour shall be submitted to labour jurisdiction, which shall be exercised in conformity with the law. 251 CERD/C/e * . pa^e 26 Article 73 ' The law shall govern relations between capital and labour, placing them on a basis of social justice and establishing special State protection for workers . Article 74 « The rights aind guarantees established in this chapter shall be I considered as minimum rights and guarsmtees for workers. The Panamanian Government's action with regard to thf' labour system is based on the Political Constitution and on recommendations by the International Labour Organisation. In Panamanian legislation, the aim is to promote public administrative action "Capable of guaranteeing the rights of the wage-earner and of assuring the employer that the worker will perform his duties correctly." The original draft of the Panamanian Labour Code was prepared by experienced Panamanian specialists on the basis of studies by the International Labour Organisation. A Mnistry of Labour and Social Welfare on the former pattern - i.e., of more control over labour - is inconceivable; it must be a genuine instrument of over-all development, and must bear in mind its interconnexions with monetary and financial policy, and with the objective of obtaining ever greater returns from the activities of Panamanian workers and entrepreneurs . The leader of the Revolution j General Omar Torrijos Herrera, has said that, in the problems of development, the worker is a vital element. The Ministry of Labour has responded to Panama's need for a balanced solution to social problems, particularly those which arise in worker-employer relations which, for 66 years of Republican life, were not .considered an integral part of the process of national development. It is interesting to note that, in Panama, provision is made for co-ordinated action with the private sector - in other words, a constant, fruitful dialogue takes place between enterprises and trade union organizations . The Tripartite Council on Trade Union Freedom is the body responsible for ensuring the widest possible freedom for trade unions, chiefly through the proper application of the legal provisions which protect the v/orkers ' right of association, in keeping with ILO Conventions No. 87 and 98 (Art. 32). The tripartite structure of this Council enables v/orkers and employers to talce their decisions independently on matters of professional organization. In labour matters, the institutional requirements of the Labour Code and the Organic Law and Regulations of the Ministry of Labovir are enforced in order to safeguard the rights of working men and women, whether majiual or v;hite-collar workers, in their efforts to make a living. ^ The Ministry of Labour and Social Welfare cannot make distinctions or establish unfair priorities. The lowliest worker and the wealthiest employer both enjoy the same right. 252 CERD/C/8 pa£e 27 The Minister of Labour, Joa^ de la Rosa Castillo, stated in July 1970: "The experience of all Panamanians teaches us that more than 90 per cent of labour conflicts axe due to the lack of communication between the man sitting with collar and tie in his office and the man toiling in the factory or on the land that he tills - a situation that we aim to solve in a programme of true social justice, clearly understood by employers and workers". One essential aspect of workers' education is the training of skilled labour, for which there is a pressing need in Panama. Collective bargaining or trade union contracts for workers constitute one of the methods used in the legal relationship between the employers and the employed; the advantages of this practice have become fully apparent and may be defined Sls follows : "A collective or trade union contract is a contract between one or more trade unions and one or more employers under which the trade xmion or trade unions undertake, on their responsibility, that some or all of their members will carry out specified work for the remuneration stipulated for each of the members". Dissatisfaction must be sought out and eliminated before it becomes irreconcilable discordj it is necessary, in an open and wide-ranging dialogue between employers and workers, to find formulas for agreement more through conviction than through authoritarianism. "Perhaps the most important difference to be solved in this field of social integration is the marked contrast between those who are v/orkers and these v/ho are entrepreneurs. Heajis must- be found to ensure that those who are workers will also become entrepreneurs, although on ft lesser scale, by acquiring shares in the enterprises in which they v/ork, thus avoiding the marked differences which were so common in the past but which have no place in today's world of broad participation of the individual in development. In this v.ay, those v/ho wish to save and acquire capital can do so, and those who wish to consvune all the product of their labour can also do so." "In the field of employer-worker relations, aJiy increase in the power of one of the groups calls for the self-discipline which comes from a full vmderstanding of the social function of the enterprise and of available resources". Wage increases must be consonant with price levels and with the productivity of the worker. A proper understanding of human resources is a fxindamental requirement in all national economic and social programmes, for such resources represent the driving force behind development and the benefits of their work must, in turn, be channelled towards them. The inter-relationships between the various aspects that govern the life of man in society clearly show the importance of the structure and dynamics of population in creating the supply of manpovrer. As stated earlier, Panama is essentially a young country, with a very large population under 15 years of age and a .substantial proportion of persons of v/orking age. On the other hand, the impact of social, economic and cultural factors, such as education, food supplies, medical assistance, social security,- employment availabilities and technological development, also add to the impact of purely demographic factors in determing the size and pattern of the working population. 253 CERD/c/8 page 28 Panama has a number of sources of useful data for studying' manpower. Nevertheless, in the analysis g'iven below only the data from national censuses will be used, in order to provide the most up-to-date and comprehensive picture of Panama's human resources and, so far as possible, of its development in recent years . TRADE UNIONS IN THE PANAMA CANAL ZONE Efforts to form trade unions of non-United States workers in the Canal Zone beg'an in 1925 with the establishment of the first trade union, which was composed mainly of Vest Indians ajid was called the Canal Zone Silver Roll Employment Association . Since then, workers" have continued to unite in various trade unions, according to the type of work they perform and the company or orgajiization in which they are employed. At present, there are three trade unions of non-United States workers in the Canal Zone, namely, the National Maritime Union, whose membership includes persons of many nationalities employed in shipping and whose operations extend all over the world; Local 300, whose members are employed in civilian work; and Local 907, vrhose members are employed by the armed forces of the Canal Zone. The latter two trade unions are affiliated with AFSCME and AFL-CIO in the United States. At present, the main protests about problems of discrimination are being made by these trade unions and not by individuals . Some protests by leaders of these trade unions to the National Government of the Republic of Fanama concerning violations of the Convention are reproduced in'an annex to this report. PRINC&AL TYPES OF EMPLOYMENT IN THE CANAL ZONE In the Canal Zone, Pemamanian manpower is employed mainly by the Panama Canal Company, which is responsible to the Government of the United States and is entrusted with the operation, defence and maintenance of the Canal and for providing public transportation and other services and for commercial activities related to the civil administration of the Zone. A considerable amount of employment in the Zone is also provided by the "Canal Zone Government", a body which is responsible to the Executive Branch of the United States Government and is entrasted with the administration of the Zone and with the organization of educational, mail, police and fire services. The United States Armed Forces (Army, Marines and Air Force), which operate military bases in the Zone, constitute a third group which employs Panamanian manpower. The three above-mentioned groups account for about 60 per cent of the jobs h^ld by Panamanian residents. The rest are employed mainly in the private sector, either by enterprises domiciled in the Zone, such as banks, insurance, passenger transport companies, shipping and other companies, or in domestic service with families living in the Zone. Lastly, about 1,500 persons are employed by contracting companies engaged mainly in construction work. 254 LAfsSUEVA IDEA diciembre. LLEGARON LOS TJSMPOS DiFtCiLES: TENEMOS ^ QUE LUCHAR. 255 EDITORIAL We produce all of the wealth yet, we suffer all the depressions!!! LD\D YOU KNOWTHAT...? All of the goods and services that we need to stay alive and survive are produce by human labor. The clothes we wear, the furniture in our homes, the books we read, our houses, our food, everything, is the product of human labor. Some of us make the goods, some of us sell them, some of us perform other important services for socie- ty. But what is important is that our exi^ tence and everyboby else's in this country is dependent on other working people. The problem is that Panamanians social system is set up so that we have to use our salaries to buy back what we and other wokers like us made. We build the houses and then we have to pay rent to live in them. We process the food and then have to buy it back with overhead added on. We produce the clothing and then c^n barely afford to buy what we have made. We work together to produce all the goods and ser- vices that we all need and the boss. takes home all the profits. The benefits of our united labor does not benefits us at all. In fact, under the present system, it works against us. Our labor is social. We all work together to keep society going. Yet the tremendous wealth that our Labor produces is taken away from us by small minority of people. The are thousand of people in this country who have to go to work everyday just to be able to afford food, clothig and a roof over their hends. And on the other hand, you have a very small minority of people, less than one (1) per cent of the population,who have taken ownership and control of all the goods and services so vital to our existence. These things include the valuable land, the natural resources. The Factories, Transportation System, etc. This group of people also privately own all the mayor bank. Chase Manhattan, Manufacture Hanover, First Na- tional City Bank, Bank of America, etc. and all the big business • Cervecen'a NaL, Indus- tria Lactsa Estrella Azul, Ref inerfa an others. And all the big stores - Dante, Sahra Fa- shion, Aldon's, Sears, etc These people do not do any work. They don't have to w« work everyday to stay alive and to produca ail the wealth for them. The Rich get richer and accumulate mo- re and more wealth from our Labor while we become poorer and poorer. ' IS THERE ANYTHING WE CAN 00? We will always have to work - but the question is: who will receive the benefits of our work? We work now because we need the tiny salary we receive in order to survive, tt is always just enough to pay the rent, buy the food and keep some clothig on our backs. The small minority knows this and will try to keep it this way for long as.they can. But the situation will not remain that way forever. We can orgar^ize ourselves in our places of work to force the bosses to pay us better wages, grant better working condition and increase our benefits. We will them get more of our share of he wealth we produce. But we will not get all of it until we control the places where we work and run them for our- selves. This task will be long and difficult one. But through united action, it is possible. Our working together in factories, in stores, in schools, in banks, in hospitals, etc Crea- tes a r^ass power that is able to produce enough godds and services to provide eve- ryone with the necessities of life. Yet, in Pa- nama today, there is not enough decent, rea- sonably priced housing for all the people who need it. The food and clothig items we produce are priced beyond our means be- cause the system is run for profit, not for people. We can and must educate ourselves about how the present system exploits and oppresses those of us who work. We can and must create a system that is run for our be- nefits and not for theirs. • When this happens, we will not have to ' worry about unemployment because when times are hard jobs will be still available for all who want to work. 256 We will not have to worry about doctor bills because good medical care will be free for everybody. The tremendoui wealth. that our labor produces, instead of providing tre- mendous profits for the few, will provide each member of the working masses with |ho means to live decent, healthy and pros- perous lives. This change can only come about when working people unite and orga- nize. Unity and organization is essential. ^0 WH*.T Yoo QsmRAK^i^^Q ''I have a solution. . . , Ortiy one of us wm eat ** WE ARE TIERD Of ALWAYS BEING LAST. OF BEING HIRED MUCH TOO SLOW, AND FI- RED MUCH TOO FAST. SOMETIME NEVER BEING HIRED! Editor: Roberto Williams. 257 This is how Is was how it has been, and how it will be for a long while. THINK ABOUT IT! '73 years ago, our parents and grand pa- rents come to Pan?"ifl, to construct a canal, they from the cjriuean islands, (such as Bar- bados, Jamaica, Vingin Island, etc.) to go- ther some money to then return home. They worked, and worked very hand, ma- ny of them died, but finally with the sweat of their daily labor, they contributed to construct the canal. At the very first begining, as they have been doing for hundreds of year, and all over the world, the northamericans conside- red us, as inferior human beings. They paid off our labor with silver roll money, whill they were paid by gold roll; they boilted se- cond hand homes for us to live in (these we- re, Red Tank, Paraiso, Gamboa, Silver City, Pedro Miguel, Rainbow City). At the endo cf the construction of the Canal, many workers were left unemployed, many lost their so called privilige5 (such as to buy in the commisory, to reside on the Canal Zone etc.), these workers and thair -families were forced to moved to, the citys cf Panama and Col6n, to unhinabited tipe of homes, to live bod. These emigrations of the unemployed workers IBER OF LEGISLATIVE COMMITTE] 270 JORGE CASTRO Lie. CARLOS CALZADILLA CAPITAN DOMINGO O'CALAGAN Dr. RAUL CHANG PINEDA CARLOS HO MOJICA / DARIO GONZALEZ PITTI FERNANDO GONZALEZ H. Dr. CARLOS PEREZ HERRERA V7ell-known Concnunist TORRIJOS COUSIN Ing. NILSON ESPINO / FRANCISCO A. RODRIGUEZ P. -MINISTER OF GOVERIIMENT & JUSTICE -Ex- AMBASSADOR TO BRAZIL -SECRETARY to the LEGISLATIVE COMMITTEE and SECRETARY to NATIONAL ASSETdBLY OF REPRE- SENTATIVES OF CORRIGIMIENTOS» -RUBBER STAMPS the work of the LEGISLATIVE COMMITTEE -DIRECTOR, COMMUNITY DEVELOP- MENT DIRECTORATE -MINISTRY OF GOVERNMENT & JUSTICE (DIGEDECOM) Spreading Communist control to lower levels. Now, Juntas Locales are being divided into Comite's de Casa y calle (house & street committees) -Ex-PRESIDENT ASSEMBLY OF REPRESENTATIVES -.SA!4E -SAME -PRESIDENT ASSEidBLY OF REPRESENTATIVES -POLITBURO MEMBER -Ex Priest -MEMBER NATIONAL INFORMATION COMMITTEE -EX-MINISTER OF AGRICULTURE & LIVESTOCK (HIDA) -MEMBER OF LEGISLATIVE COM-" MITTEE • -VICE MINISTER AGRICULTURE & LIVE STOCK 271 LILIA ROSA JAEN DE LA MATA -DIRECTOR, SOCIAL. DEVELOP- MENT of the MINISTRY OF AGRICULTURE & LIVESTOCK (MIDA) Ing. JERRY WILSON N, -DIRECTOR AGRARIAN REFORM (MIDA) ALVARO VERNAZA HERRERA TORRIJOS COUSIN -GENERAL MANAGER AGRICULTURAL DEVELOPMENT BANK (BDA) ALEXANDER AYALA •DIRECTOR AGRICULTURE & LIVESTOCK MARKETING INSTITUTE (IMA) RUAL SIERRA ■DIRECTOR GENERAL OF AGRICUL- TURAL COOPERATIVES (COAGRO) Lie. LUIS CARLOS NORIEGA BROTHER OF G-2 LTC -PRESIDING MAGISTRATE of the ELECTORAL TRIBUNAL -VOTER ID CARDS -PUBLIC RECORDS Dr. ABRAHAM SAIED (SAIED-TORRIJOS marriage bonds) MOISES TORRIJOS' daughter -MINISTER OF HEALTH Dr. HUGO SPADAFORA -VICE MINISTER OF HEALTH Lie. FERNANDO MANFREDO Known Comnunist -EX-MINISTER COMMERCE & INDUSTRIES (MICI) -Currently MINISTER OF THE PRESIDENCY -Runs a STAFF for GERARDO GONZALEZ ELI M. ABBO -VICE MINISTER OF THE PRESIDENC Lie. JULIO E. SOSA B. -MINISTER OF COMMERCE & INDUSTRIES (MICI) Lie. ARNULFO ROBLEX -VICE MINISTER (MICI) i 272 LUIS M. ADAMES Known Communist -VICE MINISTER of TREASURY (and taxes - business & real property) JOSE A. DE LA OSSA Admitted Life -Long Marxist ■EX-MINISTER OF HOUSING (MIVI) •Bank employee Dr. JULIO SANDOVAL -DIR. GENERAL OF WATER, SEWER, GARBAGE INSTITUTE ASCANIO VILLALAZ Knovm Communist -Sub-DIRECTOR OF IRHE (Power and Lights) -Has the purse strings - Fo±)rega is a figurehead. ENRIQUE RUIDIAZ -DIR. GENERAL INDE (Sports activities - stadiums, lights, etc.) Used much like Communists sports exchanges. JAIME INGRAM -DIRECTOR INSTITUTE OF ARTES and CULTURE (INAC) Used for Communist indoctrin- ation. HUGO GIRAUD Known Communist -DIRECTOR, INSTITUTE FOR THE FORMATION and EXPLOITATION of HUtiAN RESOURCES (IFARHU) TOYA TORRIJOS DE JAEN V7ell-Known Communist TORRIJOS SISTER -Works in IFARHU (All scholarships are con- trolled here) BERTA TORRIJOS DE AROSEMENA Known Communist TORRIJOS SISTER -PRESIDENT, PANAMANIAN INSTI- TUTE OF SPECIAL EDUCATION (IPHE) (REII/VBILITATION) -Prominent in the WOMEN'S MOVEZIENT AUREA TORRIJOS Known Communist TOPJIIJOS SISTER -DIRECTOR OF THE DEPARTMENT OF ARTISTIC EXPRESSIONS (Univ. of Panama) (DEXA) - a real Corriuunist nest. 273 Lie. ELIGIO SALAS DOMINGUEZ Known Communist -RECTOR OF THE UNIVERSITY -Formerly in charge of STUDENT AFFAIRS -MEMBER OF LEGISLATIVE COM- MISSION Dra. SUSANA RICHA DE TORRIJOS TORRIJOS SISTER-IN-LAW -DEAN OF THE FACULTY OF PHILOSOPHY, LETTERS, & EDUCATION, UNIVERSITY OF PANAilA ALFREDO SOLER TORRIJOS BROTHER-IN-LAW -DEAN OF THE FACULTY OF NATURAL SCIENCE £. PHARMACY Ing. GILBERTO OCANA Known Communist -DEAl^ OF THE FACULTY OF AGRONOMY EMILIO CLARE -DEAN OF FACULTY OF PUBLIC ADMINISTRATION & COr>IMERCE ♦-SCHOOL OF SOCIAL SERVICE ♦-SCHOOL OF DIPLOMACY ♦-SCHOOL OF ECONOMY GRISELDA LOPEZ KNOWN communist -DIRECTOR OF EDUCATIONAL TV -NATIONAL INFORMATION COMMITTEE -COLUMNIST -EDITORIAL PAGE of Government Daily & Sunday "REPUBLICA" Dr. LAURENTINO GUDINO Known Communist -ACADEMIC COORDINATOR OF REGIONAL UNIVERSITY CENTERS -DIRECTOR of the DEPARTMENT OF EDUCATION EVERARDO TOMLINSON H. Known Communist -SECRETARY GENEPAL OF UNIVERSIT PANAllA Prof. BLAS BLOISE CALDERON -DIPvECTOR, Of the "EDUCATORS CENTER" Prof. OLMEDO DOMINGO Kno;vn Communist -DIRECTOR, POPULAR UNIVERSITY of COCLE (Province) ♦Very heavy with Communists 274 Dr. DIOGENES CEDENO Known Communist -NATIONAL DIRECTOR OF EDUCATIONAL REFORM & PLANMIIIG DOMINGO BARRIA -UNION ORGANIZER. Masterminded the one large Central Labor Union. Now called CENTRAL DE TRABAJADORES DE REPUBLICA de PANAMA (C.T.R.P.) MARTA MATAMOROS RENATO PEREIRA Well known Communist -COMPESINO 0RGA1>IIZER -INTERNATIONAL SECRETARY UNAMUP. . . (Communist Women's Front) -MAYOR OF PUERTO ARMUELLES DIOMEDES CONCEPCION Well known Communist Dr. CARLOS IVAN ZUNIGA Rabid Socialist may be a Communist? -MAYOR OF THE MUNICIPALITY OF PANAMA -Personal friend of CARLOS ANDRES PEREZ - President of Venezuela from his exile days, EFEBO DIAZ HERRERA Well-known Communist TORRIJOS COUSIN -AMBASSADOR TO CUBA CESAR A. DE LEON ■MEMBER OF THE POLITBURO of the PARTIDO DE PUEBLO (Communist Party of Panama) COMMUNIST CONTROLLED GOVERNMENT ALBERTO LUIS TUNON RAFAEL NUNEZ ZARZAVILLA RUBEN DARIO MURGAS ; MEDIA - HEAVY WITH COI4MUNIST5 General Manager of EDITORA RENOVACIOI-T, S.a'. Editor "MATUTINO" Editor of "CRITICA" 275 News Media - continued EUCLIDES FUENTES ARROYO RODRIGO CORREA ESCOLASTICO CALVO / Lie. MARIO AUGUSTO RODRIGUEZ JOAQUIN BELENO C. / Dr. CAMILO O. PEREZ Lie. CARLOS J. NUNEZ L. President of the Newsmens Union Director of "LA REPUBLICA" Director "MAS PARA TODOS" magazine Editorial Council of MAS. TV Commentator Educator Columnist in LA REPUBLICA Column entitled "tdACHETEAIHDO Editorial Council of MAS Columnist in "MATUTIIIO" Editorial Page Columnist for t. Government daily "CRITICA" Column called "BONAFIDE" Past President of CONADESOPAZ- Panama component of Worldwide Communist Front Organization Recent recipient of State Dept Grant. Editorial Page Columnist for "CRITICA". Frequently con- tributes to column entitled "PISANDO CALLOS" Past President of CONADESOPAZ Communist Front Organization 276 EXHIBIT #2b ADDITIONAL INFORMATION ON OTHER KEY GROUPS (1) National Legislative Commission (Committee) . Those with question marks after their names are probable Coirmunists. (2) National Information Commission (Committee) Those with question marks may not be Communists. (3) ^ Presidencia Staff. This has always been full of Communists under the Torrijos Government. The last four listed may not be Communists. (4) Gobierno y Justicia. This is thoroughly controlled by Communists. The primary purpose for its inclusion was to show the power concentrated here. It shows why the post was so important to the Communists' future and the kind of power exercised by the "Premier" Juan Materno Vasquez. (5) Communist Front Organizations. This list (except for the last entry) shows how prolific the Communist/Communist front activities are. Torrijos' family is active in: FTC, FENAMUDE, FREP , OIP, GECU* , DEXA* , UNisj'lUP and with the Juventud del Partido del Pueblo (Communist Youth) . (*DEXA and GECU belong to the Panama Government run university. Torrijos' sister Aurea is in charge of DEXA. ) The List also reveals: (a) Some hot beds of Communist activity within the university are: law, dental^ economics , social work, diplomacy, public administration and commerce schools. Missing were education, journalism and psychology which are also very red. (b) CONADESOPAZ is the Panamanian component of the Russian financed World Peace Movement. The Womens Movement (UNAMUP) , Newspaperman's Organization (OIP) and Labor Group (CNTP) are affiliated with World wide Soviet led groups as v/ell as Latin American Regional groups 277 (c) Despite a state of siege under which all political parties are outlawed, only the Partido del Pueblo is permitted to operate (Juventud del Partido del Pueblo) . A newspaper clipping from a local paper will substantiate the 26th of July 1975 Anti-Facist Committee composition. (d) The Brigadas Comunales are highlighted in the 13 December 1976 "MAS para todas" Government weekly news magazine analysis in exhibit 4. It shows clearly that the Communists are using selected university students (200-300) and voluntary work programs (a la Castro Cuba) to polarize poor farmers and poor Panamanians for the class struggle. Ironically, the U.S. State Department has been helping to finance this effort (knowingly) . The Coiranunists shown on the chart of exhibit 1 and in the lists of exhibits 2a and 2b are but the tip of an iceberg. Most of the important ones are shown. The University and Education Ministry Staffs could be (and will) expanded upon usefully at a future time. Their efforts are closely integrated with those of DIGEDECOM and other Government organizations. This extends to integrating the Government controlled and financed "Panamanian Student Federation (FEP) activities on voluntary labor and Marxist political/cultural indoctrination activity. The Student Federation also extends into the lower schools throughout the country. Another important group of Communists are in the Foreign Ministry. Most of those shown in exhibit 1 or exhibit 2 (important ones) are also shown in the Panamanian Human flights Committee Work (exhibit 3) . The next big Communist effort will be directed towards creating one large 278 political party. This will probably precede the 1978 elections. Its purpose will be to create another illusion of democracy in action (idealogical pluralism) . At that time, "Poder Popular" will have passed another milestone. Soon after they have a treaty they will announce the creation of a Socialist State. It is difficult to know what the short term consequences will be. Will they move as fast as the Communists in Portugal or Chile did;' 279 NATIONAL LEGISLATIVE COMMITTEE (Draft all Laws - Members work on most importemt projects) y Lie. Marcelino Jaen Moran Lie. Carlos Calzadilla Lie. David Cordoba / Lie. Rieardo A. Rodriguez Lie. Miguel Balbino Moreno Lie. Adolf o Ahumada Dr. Rolando Murgas Lie. Eligio Salas Dominguez Dr. Carlos A. Perez Herrera Dr. Ruben Dario Herrera Lie. Miguel Pieard Ami Lie. Sergio Perez Saavedra Dr. Ernesto Pe'rez Balladares Gonzalez Dr. Jorge Eduardo Ritter Ing. Nilson Espino Lie. Oscar Ceville Celma Moncada Guerra President Brother-in-law of Torrijos Secretary (Also for the Assemby) Has acted as Committee President ] Ex-Minister of Government & Justice School boy chum of Torrijos Labor Minister Ex -Labor Minister Rector of the University Cousin of Torrijos. Ex-Priest Economist - Communist Party Finances . Author of "Poder Popular" structure Has acted as Vice Minister of Government & Justice Nephew of Rodrigo Gonzalez Currently Minister of Treasury Currently Vice Minister of Labor Ex-Secretary of Agriculture Public Employee of the Committee Public Employee of the Committee Arnulfo Quiros Sr. Luis Armuelles Pablo Castrejon Jr. Elias Castillo Rolando Candanedo Eduardo Ahumada Public Employee of the Committee Newsman - Press Secretary for Committee Public Employee of the Committee Public Employee of the Committee 280 NATIONAL INFORMATION COMMISSION Romulo Escobar Betancourt Ltc. Roberto Diaz Herrera Euclides Fuentes Arroyo Maria Guadelupe Gorgas Griselda Lopez Ernesto Solis ^ Leonidas Escobar Executive Committee Torrijos Cousin Secretarv BOARD OF CONSULTANTS *Rodrigo Gonzalez Dr. Carlos Perez Herrera Manuel Balbino Moreno LTC Manuel Noriega *T. A. Duque ♦Fernando Eleta A. *Rodolfo Garcia De Paredes Guardia Nacional Frontnan - in many businesses (ERSA) Torrijos Cousin School boy chum of Torrijos Publisher (STAR & HERALD & ESTRELLA DE PAI^IA^1A) TV - R.P.C. Channel 4 owner TV Channel 2 ov/ner Eli M. Abbo Alberto Luis Tunon Rafael Ayala Ernesto Solis Ruben Dario Del Cid Jose Gabriel Diaz Griselda Lopez *Decorative Figures Technical Consultants Vice Minister of Presidencia ERSA Min. Gobierno y Justicia P Government Information Office Radio TV Workers Union ? Panama Newsmen Association University of Panama Educational TV and Film Department will have to do what Betancourt wants. 281 PRESIDENTIAL A ICE PRESIDENTIAL STAFF PRESIDENCIA Lie. Fernando Manfredo Eli M. Abbo Rafael Ayala Jose De La Rosa Castillo Jose Guillermo Aizpu Lie. Elizabeth Silvera Lie. Moises Darwish Minister of the Presidency Ex-Minister of Commerce and Industries Vice Minister Gobierno y Justicia now Asesor (Advisor) Asesor Asesor Asesor 95-549 O - 77 - 19 282 GOBIERNO Y JUSTICIA (Government and Justice) Minister (Ex) Juan Materno Vasquez (Ex) Ricardo Rodriguez (Current) Jorge Castro (Las Tablas) (Was Amb.to Brazil) Vice Minister-Dr. Cesar Rodriguez Maylin Lie. Sergio Perez Saavedra (Acted as Vice Minister) Asesoria Legal-Dir Lie Jose A. Henriquez Direccion de Gobiernos Locales y Politica Indigenista Lie. Abel Vargas Dept. Juridico y Justicia Direccion *Naeional de Gobierno Sub. Dir. Passports Depto de Migracion y Naturalizacion Tribunal Electoral - Mag. Presidente Luis Carlos Noriega ♦Director Gen de Cedulacion - Felix Gomez **Direetor Registro Civil - Ruben A de la Guardia P. Direccion Naeional de Communieaeiones Social Director - Lorenzo Sanchez Galan Licenses for Commentators Junta Naeional de Censura (Censor) Direccion General de Correos y Telecomunicaeiones Post Office Telecommunications Telegraph Radio * ID cards for adults **Voters lists and vital records, etc. 283 Government and Justice - continued Direccion Nacional de Transito y Transporte Terreste (Transit and Land Transport) Director - LTC Manuel J. Arauz Corte Suprema de Justicia (Supreme Court) Chief Justice - Juan Materno Vasquez (formerly Minister of Government and Justice) Lesser Courts Airports Correctional Centers Womens jail Seguridad (Security) Actual control in G-2. Secret Police (DENI) Guardia Nacional - Power actually at higher level. Police functions in Guardia. 284 COMMUNIST & FRONT ORGANIZATIONS & PARTICIPANTS 7-24-75 XXII Anniversary of Castro's attack on Moncado Barracks National Anti-Fascist Committee of Panama Federacion de Estudantiles de Panama (FEP) Comite Nacional de Defensa de la Soberania y Paz (CONADESOPAZ) Frente de Trabajadores de la Cultura (FTC) Central Nacional de Trabajadores Panamenas (CNTP) Federacion de Mujeres Democraticas (FENAMUDE) Conf ederacion Nacional de Asentimientos Campesinos (CONAC) Frente Reformista de Educadores Panamenas (FREP) Union Medica Panamena (UMP) Centre de Estudiantes de Derecho (CED) Comite Paneimeno de La Organizacion Internacional de Perodistas (OIP) Comisidn Femenina Pro Defensa de las Derechas de la Mujer y el Nino Sociedad Graduados de Derecho Frente Jose Dolores Moscote , Brigadas Comunales 9th de Enero Conrado Gutierrez Ascanio Arosemena Soberania o'Muerta Asociacion Universitaria de Economia Movimiento Agrario Panameno (MAP) Frente Estudantil Revolucionario (FER) Renovacion Social de la Escuela de Trabajo Social Asociacion de Estudiantes de Odontologia ' Grupo Experimental de Cine Universitario (GECU) 285 Departamento de Expresiones Artisticas de La Universidad de Panama (DEXA) Frente Estudantil de Economia Frente Amplio de Diplomacia Frente de Reforma a la Ensenanza Universitaria Movimiento de la Juventud Kuna Movimiento de la Juventud Panameno Juventud de Partido de Pueblo (Communist Party Youth) Asociacion de Estudiantes de Servicio Social Asociacion de Estudiantes de Administracion Publica Circulo Estudantil de Comercio Movimiento Pro Mejores del Chorillo Frente Cultural "Cesar Vallejo" Guayacucho Sindicato Gran j a Experimental de Tocumen Asociacion de Estudiantes Kuna Union Nacional de Mujeres Panaraenas (UNAMUP) Formed March of 1977. 286 INTER-AMERICAN DEVELOPMENT BANK December 16, 1976 NR-114/76 INTER-AMERICAN BANK LENDS $22 MILLION FOR CONSTRUCTION OF HIGHWAY IN PANAMA The Inter-American Bank today approved a $22 million loan to help finance the construction of a highway in Panama. The loan, which was extended to the Republic of Panama, will be used by the Ministry of Public Works through its Direccion Nacional de Construccion (PNC) , to a highway between the towns of Arraijan and Chorrera, situated to the West of the Panama Canal Zone. The total cost of the project is estimated at $36.6 million, of which the Bank loan will cover 60.1 per cent and the Government of Panama will cover the re- maining 39.9 per cent. The PNC will use the Bank's loan to construct 14 miles of a high speed :iigh- way between Arraijan and Chorrera. The new highway will have four lines, each of which will be 3.6 meters wide, and will have a capacity to handle 36,000 vehicles daily. It will run parallel to the Pan American Highway, which is presently saturated with a traffic volume of 8,000 vehicles per day. Execution of the project will relieve the traffic congestions in Panama City and adjacent areas, expand the urban development area included within the metro- politan area, provide a safer road and thus reduce the frequency of traffic acci- dent, reduce the transportation cost of users, and encourage tourist-related activi- ties. The tnter-American Bank has approved four previous loans totaling $64.5 million to help Panama finance road projects. Two of these loans have been comple ely dis- bursed. 287 - 2 - Today's loan was extended from the ordinary capital resources for a term of 20 years at an interest rate of 8.6 per cent per annum. Up to $20.5 million of the loan will be disbursed in dollars or other non-Panamanian currencies and up to the equivalent of $1.5 million will be disbursed in Panamian balboas. The loan will be repaid in 22 semiannual installments, the first of which will be due U-\l2 years after the date of the loan contract. Principal and interest payments will be made proportionately in the currencies disbursed. The loan will be guaranteed by the Republic of Panama. SUMMARY DATA COUNTRY: Panama. PROJECT: Construction of a highway. BORROWER: The Republic of Panama. EXECUTING AGENCY: Ministry of Public Works through its Direccion Nacional de Construccion (PNC) , Panama City, Panama. TOTAL COST: $36.6 million, of which $20 million are direct construction costs. BANK LOAN: Ordinary capital resources, $2^ million ($20.5 million in dollars or other non-Panamian currencies and the equivalent of $1.5 million in Panamian balboas) . OTHER FINANCING: Government of Panama, $14.6 million. PROJECT DESCRIPTION: The construction of 14 miles of a high speed, four-lane highway between Arraijan and Chorrera. GOODS AND SERVICES: The awarding of contracts for execution of the works. PROCUREMENT PROCEDURES: International public bidding among Bank member co\.ntries on goods and services imported with resources of the Bank loan. NatidTnal ' public bidding on domestic purchases. ESTIMATED COMPLETION DATE: 1980. Dececiber 16, 1976. 288 INTER-AMERICAN DEVELOPMENT BANK ^ J 808 17TH STREET. U W . WASHINGTON. D C 20577 TELEPHONE 634-8000 FOR IMMEDIATE RELEASE December 9, 1976 NR-104/76 INTER-AMERICAN BANK LENDS $5 MILLION FOR INDUSTRIAL CREDIT PROGRAM IN PANAMA The Inter-American Bank today approved two loans totaling $5 million to help finance an industrial credit program for the private sector in Panama. The loans — $3 million from the Bank's Fund for Special Operations and $2 million from its ordinary capital resources — were extended to the Banco Nacional de Panama (BNP) , an autonomous state entity which operates largely as a commercial bank but which also grants development credits and performs certain central bank functions. The BNP will u5e the resources of the Bank loans to extend medium- and short-term credits to small and intermediate industrial producers to establish, expand and improve manufacturing companies in the private sector. Credits approved under the program will be used to cover fixed investments and working capital . The total cost of the program is estimated at $7.5 million, of which the Bank loans will cover 66.7 per cent and the BNP the remaining 33.3 per cent. As a result of efforts to stimulate the sector, the Ministry of Planning and Economic Policy has projected private investments of $141 million in industrial manufacturing in the 1977-80 period which, if fulfilled, could produce an average annual growth of 5.5 per cent in the industrial manufacturing sector. ^ Since 1964 the Inter-American Bank has extended four loans totaling $7.5 million to the BNP in an effort to help develop agriculture and industry in Panama. 289 - 2 - . Today's loans include: $3 million from the Bank's Fund for Special Operations for a term of 20 years at an interest rate of 2 per cent per annum, of which $1.5 million will be drawn from the unrestricted resources of the Fund. The loan will be disbursed in dollars or other non-Panamanian currencies which form part of the Fund. The loan will be repaid in 32 semiannual installments, the first of which will be due 4-1/2 years after the date of the loan contract. Principal and interest payments will be made proportionately in the currencies disbursed. $2 million from the Bank's ordinary capital resources for a terra of 20 years at an interest rate of 8.6 per cent per annum. The loan will be disbursed in dollars or other non-Panamanian currencies which form part of the ordinary capital resources. The loan will be repaid in 32 semiannual installments, the first of which will be due 4-1/2 years after the date of the loan contract. Principal and 3 interest payments will be made proportionately in the currencies disbursed. The loans will be guaranteed by the Republic of Panama. 290 SUMMARY DATA COUNTRY: Panama. PROJECT: Industrial credit. BORROWER AND EXECUTING AGENCY: Banco Nacional de Panama (BNP) , Apartado 5220, Panama 3, Panama. TOTAL COST OF PROJECT: $7.5 million. BANK LOANS: Fund for Special Operations, $3 million in dollars or other non-Panamanian currencies, including $1.5 million in unrestricted resources Ordinary capital resources, $2 million in dollars or other non-Panamanian currencies. OTHER FINANCING: BNP, $2.5 million. PROJECT DESCRIPTION: The granting of medium- and short-term credits to small and intermediate Industrial producers to establish, expand and improve manufacturing companies in the private sector. GOODS AND SERVICES: The acquisition of machinery, equipment and tools and the construction, assembly and installation of industrial plants. ESTIMATED COMPLETION DATE: 1980. December 9, 1976 29\ mm INTER-AMERICAN DEVELOPMENT BANK 800 mH STREET. NW.. WASHINGTON D C ?05r7 TELJEPMONE 6M-«000 FOR IMMEDIATE RELEASE J»ily 29, 1976 NR-49/76 INTER- AMERICAN BANK GRANTS $125,000 TO PANAMA FOR A REGIONAL STUDY ON FINANCING LATIN AMERICAN EXPORTS The Inter-American Bank today announced the approval of $125,000 in non- reimbursable technical cooperation to carry out a regional study aimed at providing alternatives for the creation of a multinational mecanism to facil- itate financing Latin American exports. The technical cooperation, extended to the Governnent of Panama from the Bank's Fund for Special Operations, will be used by the Ministerio de Planif icacion y Politica Economica (MPPE ) and the Comisicn Bancaria Nacional (CBN) , Panama's Ministry of Planning and Political Econcay and National Banking Commission, to contract consultants to undertake the studies. The total cost of the technical cooperation is estinated at $160,000, of which the Bank's contribution will cover 78 per cent and the Government of Panama the remaining 22 per cent. The consultants' work will consist of the preparation of a detailed report containing an analysis of the present situation and existing mecha- nism for financing Latin American exports; and the objectives and economic foundations for a new financial export mechanism as well as the benefits and costs to be incurred by the Bank's member countries in creating such 8 mechanism. From 1970 to 197A, the share of Latin American exports in world trade decreased from 6.1 to 5.2 per cent. During this period, exports as a share"* of regional gross national product declined from 12.5 to 11.8 per cent. To reverse this trend, Latin America needs to increase its exports and improve its ability to compete in international markets — an aim which can be achieved if more financial resources are made available for exports- INTER-AMERICAN DEVELOPMENT BANK 808 17TH STREET. N W . WASHINGTON. D C 20577 TELEPHONE 634-8000 FOR IMMEDIATE RELEASE July 22, 1976 KR-A7/76 IDB GRANTS $158,000 FOR INSTITUTIONAL STRENGTHENING OF THE NATIONAL FINANCE CORPORATION The Inter-American Bank today approved $158,000 in nonreimbursable technical cooperation to strengthen the Corporacion Financiera Nacional (COFINA) of Panama. COFINA is a new development finance agency. The cooperation, extended from the income of the Bank's Fund for Special Operations, will be used to contract a consulting firm to advise COFINA during the initial stage of its operations on an appropriate institutional framework for its short-, medium- and long-term activities. Special emphasis will be placed on basic organization; decision-making procedures; estimates of volume of operations and capital requirements; financial administration; operational norms and procedures, and training for its professional staff. The total cost of the technical cooperation is estimated at $238,000, of which the Bank's contribution will cover 66. A per cent. The remaining 33.6 per cent will come from local sources. Since 1972, the Government of Panama has adopted measures to institu- tionalize the promotion of large-scale industrial development and exports. Although the National Bank of Panama lends to agricultural and industrial sectors, it does not meet the needs of large-scale industrial enterprises. As a result, the Government of Panam.a decided, early in 1976, to ■* establish the COFINA to provide long-term financing to create or expand industrial firms, with special emphasis on sectors producing for the export market. 293 INTER-AMERICAN DEVELOPMENT BANK 808 17TH STREET. N W , WASH.NGTON. D C 20577. TELEPHONE 634-6000 FOR IMMEDIATE RELEASE December 5, 1975 NR-94/75 INTER- AMERICAN BANK LENDS $12.2 MILLION TO IMPROVE TECHNICAL AND VOCATIONAL EDUCATION IN PANAMA The Inter-American Bank today announced the approval of a $12.2 million loan to help expand and improve intermediate level technical and professional education in Panama. The loan, which was extended to the Government of Panama, will be used by the Ministry of Education to implement educational reform in Basic Cycle schools and in professional and technical institutes in an effort to satisfy a national demand for skilled and semiskilled labor estimated by the Ministry of Planning and Economic Policy of Panama at more than 140,000 workers by 1980. The total cost of the program is estimated at $18 million, of which the Bank loan will cover 67.8 per cent and the Ministry of Education the remaining 32.2 per cent. The program calls for: The construction of approximately 19 schools to teach the Basic Cycle and of approxiirately four vocational and technical institutions. The equipping of these schools through the acquisition of machinery, tools, teaching materials, furniture, laboratory equipment and textbooks. In^addition to the loan, the Rank approved $333,000 in grant tfecl.ni 17 1 May 2, 197U PR-I8/7U FOR IMMEDIATE RELFASE INTER-AMERICajI BANK LENDS $3-5 MILLION TO HELP PAKAM.'V DEVELOP FISHERY RESOURCES The Inter-American Bank today announced the approval of a $3-5 million loan to help Panama develop its fishery resources by the expansion and consolidation of small-scale fishing cooperatives on both coasts. The loan, which was extended to the Republic of Panama, will be used by the Banco de Desajrollo Agropecuario (BDA), Panama's national agriculture development agency, to supply the credits necessary to expand and consolidate four existing cooperatives, to orgEinize five additional cooperatives in select- ed coastal localities and to organize a cooperative marketing federation in Panama City, The total cost of the project is estimated at 890, 000, of which the Bank loan will cover 71.6 per cent and the Panamanian Government the remaining 28. U per cent. The four existing cooperatives which will be expanded £ind consolidated ere located at Chorillo, Farall6n, Pedregal and Monti jo on the Pacific Coast, while the five new cooperatives >rill be established at Chepillo, San Miguel, Armuelles and Mcnsab^ on the Pacific coast and at Almirante (Bocas del Toro) on tbr. I'tJ^ntic .:r>aGt. 306 - 2 - Resources of the Bank loan will help the fishing cooperatives to ac- quire complete fishing vessels and/or hulls and materials for the construc- tion of fiberglass vessels, marine diesel engines, equipment, nets and fish- ing gear; to construct vharves, berths, buildings and other shore facilities, and to purchase and equip cold-storage and related facilities. The Bank loan includes $l80, 000 in technical cooperation which will be used to contract consultants to help organize and operate the cooperatives and maintain- equipment and to inprove administrative techniques of the BDA. The project is expected to provide new boats for an estimated 200 fisherman and to double the amount of fish produced for domestic consur?)tion. Initially it will create Ul2 new jobs in coastal areas and by the fifth year will benefit an estimated 1,500 cooperative members. In addition, it will increase the average annual income of Panamanian fishermen from $U0O at present to approximately $1, 56O. Panama's small-scale fishing fleet consists of 6OO boats, 36O of which are equipped with snail motors and average 12 meters in length. Today's loan was extended from the Bank's Fund for Special Operations for a term of 30 years at an interest rate of 2 per cent per annum. It will be disbursed in dollars or other non-panajuanian currencies. The loan will be repaid in 50 semiannual installments, the first of which will be due 5-1/2 years after the date of th'e loan contract. Principal and interest payments will be made proportionately in the currencies lent. 307 SUMMARY DATA COUNTRY: Panama PROJECT: Cooperative Fishery BORROWER: The Republic of Panama EXECUTING AGENCY: Bsinco de Desarrollo Agropecuario (BDA), Panama City TOTAL COST: 89O, 000, of which $2,803,000 l-epresents direct costs. BANK LOAN: Fund for Special Operations, $3.5 million (in dollars or non- Panamanian currencies). OTHER FZNANCING: $1,390,000 by the Panamanian Government. PROJECT DESCRIPTION: The expansion and consolidation of four existing fisheries and the organization and establishment of five new co- peratives in selected spots along both of Panama's coasts, as well as a federation of cooperatives in Panama City, through subloans to those associations for the piurchase of vessels, machinery and modern equipment, the purchase of land and vehicles and the instal- lation of landside facilities. GOODS AND SERVICES: The purchase of 25 and 30-foot fishing vessels, transport vessels, construction materials and services, machinery and equipment and vehicles, and the contracting of advisory ser- vices for the promotion and operation of the fishery cooperatives and of vessels and fishing equipment and in the processing by the BDA of subloans to program beneficiaries. PROCUREMENT PROCEDURES: International public bidding among member nations of the Banks on goods and services in5)orted with resources of the Bank loan. National public bidding on dcmestic purchases. ESTD^ATED DATE OF CaiPLETION: 1979. Nay 2, 1974 308 I INTER-AMERICAN DEVELOPMENT BANK 808 17th. ST N.W. WASHINGTON. D.C. 20677 TELEPHONE. EX 3 4171 v:^:^:iL,A December I3, I973 NR-58/73 FOR IMMEDIATE RELEASE INTER-AMERICAN BANK LENDS $15 MILLION TO HELP BUILD DARIEN GAP HIGHWAY IN PANAMA The Inter-American Development Bank today announced the approval of a $15 million loan to help build a 193-nile highway through the Darien gap in Pauamfi.. The highway would be the final link in the Pan American Highway System which extends from Alaska to the southern tip of South America. The Bank loan, which was extended to the Republic of Panama, v;ill hel-) the Ministry of Public Work.-, of Panama (MOP) through its Pan American High- way Department to build three sections of the Darien Gap Highway totalinf^ lOU miles in length, or approximately 5^ per cent of the route in Pansina. The resources of the Bank loan vdll help finance the direct costs of construction, including earthmoving and drainage works, structures and se- lected material, along three sections of the project totaling lO^i-miles — Tocumen-Canitas, 35 miles, at the northwestern terminus of the road; Eayanr- Canazas, W+ miles, and Yape-Palo de las Letras, 25 miles, at the Colcmbias border. The construction of the highway through the Darien Isthmus in both Panama and Colombia will permit unbroken highway communication between Alaska ajid the southern tip of South America. The idea of linking the capitals of all the Latin American countries by road was first discussed - 2 - at the First Pan American Conference, held in Washington, D.C., In I889, and was formally adopted in the r'irst Pan American Higjiway Congress in Buenos Aires, Argentina, in 1925- In 1963 the continuous highvreiy from Alaska to Panama City was opened to traffic, a distance of 7,656 miles. Sections of the highway in South America were also built, leaving the Darien route as the only incomplete portion. The total cost of the project is estimated at $106.8 million, of which the Bank loan will cover lU.OU per cent, the Panamanian Government 7.89 per cent and the United States Government, the Export-Import Bank and the First National City Bank of Chicago the remaining 78. 07 per cent. Under a law approved by the Congress in 1970, the United States Govern- ment has made available a grant of $100 million, or two-thirds of the origin- al estimated cost of the project, to assist Panama and Colombia in financing the construction of their respective portions of the highway. Of this amotmt, $60 million was eaxmarked for Panama and $U0 million for Colombia. Execution of the Darien project will stimulate regional economic in- tegration by permitting an easy flow of highway traffic between South America on the one hand and Central America and Mexico on the other. In addition, the new roadway will enable Panama to incorporate the entire eastern sec- tion of the country--ccciprising some 7,700 square miles and representing about one-third of the nation's total area--into the national economy, there- by facilitating exploration of the hitherto inaccesible region and permitting the exploitation of any natural resources that may be found there. Today's loan was extended from the Bank's Fund for Special Operations (frcan resources provided to the Bank by Bank members prior to May 3, 1972) for a term of kO years at an interest rate of 2 per cent per annum. Up to $11. U million of the loan will be disbursed in dollars and up to the equiva- lent of $3.6 million will be disbursed in balboas. The loan will be repaid 'in 60 semiannual installments, the first of which will be due IO-I/2 years after the date of the loan contract. Prin- cipal and interest payments will be made proportionately in the currencies disbursed. 310 SUMMftRY EATA COUWTRY: Panajna. PROJECT: Darien Gap Highway. BORRCJWER: The Republic of Panama. EXECUTING AGENCY: The Ministry of Public Works of Panama (MOP) throu^ its Pan American Highway Department. TOTAL COST: $106.8 EtdUion, of which $8l million represents direct construction costs. BANK LOAN: Fund for Special Operations, $15 million ( $11. U million in dollars, $3*6 million in balboas). OTHER FINANCING: The Government of Panama, $8,Ul5,000; the United States Government, $68. U million; the Export -Import Bank and the First National Bank of Chicago, $7. 5 million each. PROJECT DESCRIPTION: The construction of the first stage of a modem highway totaling 193 miles in length through the Darien region of Panama, *st«Lrting near the Tocunen Airport and extending through the towns of Chepo,Canitas, Aibir and Canazas in the Province of Panama, and Santa F^ and Yaviza in the Darien Province, as far as the Panama-Colombia border at Palo de las Letras, and including the erection, construction or installation of earthworks, drai'-.s and culverts, structures and a wearing course finished in gravel on six sections of the highway. Paving of the highway will be done, at a later date during the second stage of the construction. GOODS AND SERVICES: The financing of direct construction costs. PROCUREMENT PROCEDURES: International competition exclusively in Panama and the United States. ESTIMATED CCMPL2TI0N DATE: 1978. December 13, 1973 73/9207 311 SUMMARY IRTA COUMTOT: Panama. FKCXTECT: Industrial credit program. BORROV.'ER Airo EXECUTING AGENCY: Banco Kaclonal de Pannm^ (BKP) . TOTAL COST: $6 million, of which some $3 million vill cover direct investment costs. BAIOC LOAN: Fund for Special Operations, $3 million (in dollars or other non-Panaroni an currencies). OTHER FXNAIJCIiro: Beinco Nacional de Panam^, $L 5 million, and beneficiaries, $1. 5 million. • PROJECT DESCRIPTION: The continuation of a program to grant long-term credits at concessional interest rates to stimulate the establishnent, expansion or ijnprovecent of snail- and cediiio-sized private indastj-ial enterprises , in furtherance of Panama's Rational development goals. GOODS AND SERVICES: The acquisition of imported machinery, equlpoent, construction components and services. ESTIMATED COI-IPLEnON DATE: I97S: August 2, 1973 73/6663 312 INTER-AMERICAN DEVELOPMENT BANK eOP ITth PT N W \% ASHINGTON. D C 20677 TELEPHONE. EX 3 4171 j Deceober 5, 1972 MB-U6/72 FOR I?«EDIATE P.5LEASE BAIK IZNDS $7.5 fOXLION TO CONSTRUCT POTABLE HATER AND SEWAGE SYSTEMS IH PAHAKA The Inter-Anerican Bank today approved a $7-5 million loan to help Far.aiLa construct and expand water supply and sewage systecs which will benefit approxinately lU0,0CO persons in the interior of the country. The loan, wh'ich was extended to the Institute de Acueductos y Alcan - tarilladoc Kacionales (IDAA^Q . the autonomous state agency in charge of construction, operation and maintenance of water and sewage systeis in J*2iiaica, will help finance the construction of new potable water systems in sooe 60 rural villages, the expansion of existing water systems in approximately 20 SDall towns and the instaLlation of a sewage system in a densely-populated section of the city of David. The total cost of the project is estimated at $11, U50, (XO, of which the Bank loan will cover 65-5 per cent and Panamanian sources the remain- ing 3^-5 per cent. Specifically, proceeds of the Bank loan will help finance: --TV-e construction of new potable water systems in approximately 60 rural villages containing less than 2, CXX) inhabitants each and benefiting a total population of about 6I, 000 persons. 313 - 2 - — rne expansion of existing water systeas in s'ooe 20 other rur£l tcvus and cities, benefiting a total of approxicately 60, COO prr??r.j. of there cocaaunities, l8 have a pcpuLatior. of 5, OCO or lesz. —The installation of a sevage system which will benefit soae 19, OCC persons in tbe most densely-populated section of David which, with a population of 39,000, is the third largest city in the republic. Tlie execution of the project is expected to produce a decline in the incidence of v/ater -borne diseases in- the interior of Panajsa which, in turn, will beneficially affect labor productivity, dioinish the rate of infant lEortality and generally facilitate socio-econocic developnent. The loan is the third credit extended by the Inter-A"3rican BarJ'. tc IDAAII since 1962 to help construct and expand water and sewage systo-.s ia, the interior of the countrj'. The previous two Bsni: loans totaled $6,212,000 and financed programs with a combined cost of approximately $12-7 oillioe. In 1952 the Banli authorized a $2, 762, CCO loan from its Social Prv^re;- Trust Fund to help IDAAII finance fhe cons'truction and expansion of pot=ljj.e water systen;; in seven cities with a cocabined population of 78, 600 and to construct water treatment plants in three of these cities. In 19^7 the Bank approved a second loan in the accunt of $3,^50,000 froc its Fur.-, fc. Special Operations to help IDAAI-f inprove water systeas in approxinately rural comunities and to extend the sewage system in Chitre. Today's loan was approved from the Bank's Fund for Special Operati.?.^s for a terra of 35 years at an interest rate of 1-l/h per cent per annuc. In addition, a service charge of 3/U of I per cent will be charged cn 95-549 O - 77 - 21 314 - 3 - principal amounts outstanding. Up to $U, 250, 000 will be lent in dollai-3 or other non-Panamanian currencies which form part of the Fund and up to the equivalent of $3,250,000 will be lent in balboas. The loan will be repaid in 5U semiannual installments, the first of which will be due ff-l/2 years after the date of the loan contract. Principal and interest payments will be made proportionately in the currencies disbursed. The loan will be guaranteed by the Republic of Panama. SUMMARY DATA COUNTRY: Panama. PROJECT: Water supply and sewage systems. BORROWER AND EXECUTING AGENCY: Instituto.de Acueductos y Meant ariUados Nacionales (IDAAN), Panama City, Panama. TOTAL COST : $11, U50, 000 . BANK LOAN: Fund for Special Operations, $7-5 million ($U, 250, 000 in dol- lars or other non-Panamanian currencies and $3,250,000 in balboas). OTHER FINANCING: $3,71+0,000 from IDAAN and $210,000 in community support. PROJECT DESCRIPTION: The construction of new water systems in approximately 60 rural villaees with a total present population of about 6l,000, the expansion of existing water systems in some 20 other small cities with a present population of about 60, 000, and the installation of a sewage system which will benefit an estimated 19,000 inhabitants of the south- western section of David, the third largest city in Panama. GOODS AND SERVICES: The purchase of construction tools and materials, transportation, metering, pumping and chlorination equipment; rural water systems, metal tanks, well piping and other materials. PR0CURH1ENT PROCEDUP^S: International public bidding among eligible member countries of the Banli on imported equipment covered by resources of the Bank loan. National public bidriin^ on dome>tic purchases. ESTIMATED COMPLETION DATE: 1976. December 5, 1972 72/7822 315 BANCO INTERAMERICANO DE DESARROLLO HOS 17th. N.W. WASHINGTON. D.C. 20B77 TELE FONO. EX 3 4 1 7 1 9 de noviembre de 1972 CP- i+2/72 PARA SU FUBLIOiNCION IMMEDIATA FL BID PRESTA $1,3 MILLON A PAIIAMA PAR/. PROGRAMA DE DESARROLLO AGROPECUARIO El Banco Intcramericano de Desiarrollo anuncio hoy la aprobacion de un prestamo por el equivalente de 1. 300. 000 dolares para eyudar a mejorar la produccion agrop^cuaria en Panama. El prestatf.rio es el Instituto de Fonento Economico (IFE) , organismo gubernamental encargado de ejecutar los planes nacionales de desarrollo en el sector agropecuario. Los recursos del prestano contribuiran a f inane iar la etapa complemen- taria de van progrataa de credito y mercadeo encaminado a eyudar a los peque- nos y medianos agricultores y ganaderos de todo el pais a adquirir maquina- rias agropecuarias, ganado bovino de pure raza para carne y leche, ganado porcino y aves de corral, asi como a preparar la tierra y hacer mejoras en sus fincas para la produccion de arroz, tr.alz, frijoles, tomates y otros productos . El programa f'ue iniciado en I969 con la ayuda de otros dos prestscios del BID, por un total de $6,1+ millones, y eu priaiera etapa tuvo un costo total de $15,^ millones. El costo de la etapa complement aria, a la cual se destinara el nuevo f inane iam lento, se estima en $2. 68'+. 000, de los cuales el prestamo del Banco representa el hQ por ciento; el ^2 por ciento restan- te serd f inanciado, en partes iguales, por el IFE y los benef iciarios . 316 - 2 - La ejecuci6n del programa permltir^ a los egricultores y ganaderos panamenoc a'anentar la productlvidad de sus cosechas en una medida que, segun se espera, elevara sus niveles de Ingreso aproximBdamente en un 20 por ciento. En 1970 y 1971, los dos primeroe anoa de ejecuci6n del prograina, el IFE extendio un total de 3.500 creditos per una euma aproxiinada de $8,5 millones, cobrepasando las metas fijadas inicialmente. De ese total, 2.800 creditos, por el equivalente de $5 millones, fueron suministrados e pequenos productores y los 700 restantes, por el equivalente de $3,5 millo nes, a medianos productores. Por otra parte, con la ayuda de una partida de $593,000 suministrada previamente por el Eanco pare financiar costos de asistencia tecnica, el IFE ayud6 a iniciar diversos estudios de produccion de granos, a determi- nar la localizacion y dieenar nuevas iostalaciones de almacenamiento, a ensanchar o remodeler plantas existentes y a dotar a los beneficiaries del prograxa de cervicios de extension agropecuaria. La produccion agricola representa el 25 por ciento del prcducto in- terno bruto de Panama, pero en los ultimos anos no se ha incrementado al mismo rittno que la de otros sectores. Esto se ha debido en gran parte a la falta de naquinarias modernas, tecnicas adecuadas de produccion y sufi- cientes instalaciones de almacenamiento. El Gobierno de Panatrd, en vista de esta situacion, ha dado alta prio- ridad al desarrollo agricola, destinando alrededor del 17 por ciento dsl total de las inversiones publicas a este sector, durante el periodo cocpre dido entre 1962-72. 317 - 3 - El prestamo aprobado hoy fue extendido del Fondo para Operaciones Esp€ciales del Banco, por un plazo de 35 aSos y con un interes del 1-l/U por ciento anual. Se cobrard ademds una comisi6n de 3/4 por ciento sobre los saldos deudores. Haeta el equivalente de $8146.000 ser^ desembolsado en dolares o en otras monedas que formen parte del Fondo, excepto balboas, y el equiva- lente de $1+51+. 000 sera desembolsado en balboas. El prestamo sera anortizado en 54 cuotas semestrales, la primera de las cueles sera pagadera 8 I/2 anos despues de la fecha de suscripcion del contrato. Las cuotas de amortizacion y los intereses se pagaran proporcio- nalmente en las monedas desembolsadas o, a eleccicn del deudor, en balboas. El prestamo tendra la garantia de la Republica de Panama. RESUIvEN DE DATOS PAIS: P&nauA PROYECTO: Credito agropecuario. PRESTATARIO Y ORGANISKO EJECUTOR: Institute de Fomento Econ6mico (IFE). FIMNCIAMIEI.TO DEL BANCO: $1,3 millones del Fondo para Operaciones Espec isles / $846. 000 en dolares u otras monedas excepto balboas, y $454,000 en balboas). OTROS FINAKCIAMIEKTOS: $692,000 del IFE y $692,000 de los benef iciarios . DESCRIPCION DEL PROYECTO: Etapa complementaria de un programa de credito inlciado en I969, que esta eyudando a m^s de 2.800 pequenos producto- res y 700 medianos productores a financiar la compra de maquinarias agrfcolas y ganadc bovino y porcino, asi como a preparar y mejorar sus fincas para 1^ produce ion de arroz, maiz, frijoles, tomates y otros productos . BIENES Y SERVICIOS: Compra de maquinaria agricola, ganado, semillas y otros bienes. FECHA ESTIIAADA DE TERMINACION: 1974 . 9 de noviembre de I972 72/7685 318 INTER-AMERECAN DEVELOPMENT BANK B08 17th. ST. N.W WASHINGTON. D.C. 20r>77 TELEPHONE. KX 3-4171 July 5, 1972 NR- 19/72 FOR IMMEDIATE RELEASE BANK APPROVES $6.9 MILLION LOAN TO IMPROVE NATIONAL U^^rVERSHY OF PANAMA The Lnter-Am'jrican Bank tcxiay announced the approval of a loan equival- ent to $6.9 million to expand academic capacity and physical facilities at the National University of Panama. The total cost »»f the program is $10,700,000, of which the Bank loan will cover per cent and the National University of Panama the remaining 35.5 per cent. Specifically, the project is designed to: — Improve academic qualifications by providing scholaj-ships for post- graduate study in foreign countries for 110 faculty members, --Implement a regular system of re\-iew and evaluation of curricula content and teacher effectiveness. --Improve administration and financial planning and management capabil- ities and systematize accounting, budgeting and inventory control procedures. --Construct 8 additional library, classroom, laboratory and administra- tion buildings and an annex for an existing structure and buy the furniture, library books, laboratory equipment and teaching aids needed for these facil- ities. 319 - 2 - A total nf $1.2 million of the Bank loan will be used for technical assistance. Of this amount, $1.1 million will be devrrted to the faculty scholarship program and $126,000 will be used to hire conpult&nts to work with the University Planning Office on academic and physical plaaalog and admialstratlve and financial management. Ninety-five per cent of students of college age lo Pasama attend the National University of Panama, the only public university in that country. Enrollment for the 1971-72 academic year Is lU, U67. Of a total faculty of 581, only about 128 possess doctoral degrees and only 125 are full time professors . The Bank loan will enable the University to expand its physical facil- ities sufficiently to relieve present crowded conditions, particularly in the architecture, engineering, natural sciences and - agrt«insy faculties which are coosidered of major importance to continued national econoodc develop- ment, and to handle an emtlclpated enrollment of more thai; 25,000 students at the University by 1980. The improvement of academic qualifications of the faculty ia considered essential if the University is to add 672 full time professors to keep pace with expanded enrollment -and create a 70-30 ratio of full time to pert time teaching personnel by the end of the current decade. Today's loan was extended from the Bank's' Fund for Sprcial Operations for a term of 35 years at an interest rate of l-l/^ P^r cent- per annum. In'' addition, a service charge of 3/U of 1 per cent will be charged '^n principal '-amounts outstanding. 320 - 3 - Up to $5 million of the loan will be provided in nrn-reramanlan currencies which are part of the Fund and the remaining $1.9 million in balboas. The loan will be repaid in semiannual installments, the first of v^hich will be due 8-1/2 years after the date of the loan contract. Principal and interest payments will be made proportionately in the currencies dis- bursed or, at the option of the borrower, in balboas. The loan will be guaranteed by the Republic of Panama. SUMMARY DATA CCUNIKY: Panama. PROJECT: Expansion of university facilities. BORROWEIt AND EXECUTING AGENCY: National University of Fanaxoa. TOTAL COST: $10,700,000. PANK LOAN: Fund for Special Operations, $6,900,000 ($5 million in non- Panamanian " currency and $1.9 million in balboas). OTHER FINANCING: $3.8 million from the National University of Panama. .PROJiX^T DESCRIPTION: Funding of scholarships for postgraduate study abroad by 110 faculty members; improvement in personnel management, academic and physical planning, and financial budgeting, management and control; ex- pansion of physical facilities at four university faculties. GOODS AND SERVICES: Financing of faculty scholarship program, contractir^ of consultants to work with University Planning Office and purchase cf laboratory and teaching equipment, fiirniture, bo'oks and publications. PROCUREMEOT PROCEDURES: International public bidding among member countries of the Bank, on imported equipment covered by foreign exchange and national public bidding on domestic equipment and services. ESTIMATED COMPLETION DATE: 1976. July 5, 1972 INTER-AMERICAN DEVELOPMENT BANK 808 17tli. ST. N.W. WASHINGTON. D.C. 20577 TKLEPHON E. EX 3 4 17 1 April 22, 1971 NR- 16/71 FOR 3>J/IEDIATE RELE.-m of 20 years at an interest rate of 3-1/'* per cent annually. In addition, a service charge of 3/^4 of 1 per cent will be charged on principal amounts outstanding. Up to $ll,2l8, OCO will be. disbursed in dollars or in other non- Panamanian currencies whieh are part of the Fund, and the remaining $4,782,000 will be disbursed in balboas. The loan will be repaid in 3k semiannual installments, the first of which will be due 3-1/2 years after the date of the loan contract. Prin- cipal and interest payments may be made in balboas or, at the option of the borrower, proportionately in the currencies lent. 71/5339 325 INTER-AMERICAN DEVELOPMENT BANK I7th. ST. N.W. WASHINGTON. D C. 20577 TKLEPHONK. EX 3 4J71 August 6, 1970 I1R-32/7C FOR II^DIATE RELEASE mm LENDS $1. 7 MILLION TO ESTABLISH PREINVEST14EIJT FUND IN TkW^J'A The Inter-Acerican Pan!; today announced the approval of a loan extended to the Republic of Panaira for the equivalent of $1. 7 mil- lion to finance the establishment of a Preinvestment Fund. The Bank's loan, together with $730,000 provided by the Pana- manian Government to establish the Fund, will be maintained and dis- bursed through a special account in the Banco Nacional de Panamd , the Fund's financial agent. The Bank's contribution amounts to 70 per cent of the Fund's initial financing. Established with an initial $2. U million, the Fund will nake re- imbursable subloans to carry out preinvestip.ent studies for public and private entities in Panama. Up to 30 per cent of the Fund's initial resources may be used to finance general studies of a regional or sectoral nature, v/ith the principal aim of establishing national developtr^nt priorities for Pa- nama. The balance of the resources will be used to finance studies of specific high priority development projects. Not less than 20 per cent of the Fund's resources will be used to finance studies for developm.ent in the private sector. 326 2 The Panananiein Planning Office has prepared a national Devel- opoaent Strategy, which outlines developcent goals for the country as well as; a Program of Public Investment. The projects included In the anticipated Investment program require substantial invest- irents, but tr&ny of them suffer from a lack of feasibility studies. It is anticipated that the establishaient of the national Preinvest- rcent Fund will correct this situation and provide Panaca with a con- tinuing tsechanism for undertaking developcent studies. These studies, in turn, will be detailed enough to be used as the basis for project financing requests before domestic and international lending entities. Today's loan was extended froc the Fund for Special Operations for a terra of 15 years at an interest rate of S-l/** per cent annually. In addition, a service chart^e of 3A of one p^r cent will be charged on principal acconts outstanding. Up to the equivalent of $1,230,000 will be extended in dollars or other non-Panacanian cur- rencies which are part of the Fund- The recaining $420,000 will be disbursed in balboas. The loan will be repaid in 2k equal seiniannual InstallnML-nts, the first of which will be due 3-1/2 years after the date of the loan contract. 70/4037 INTER-AMERICAN DEVELOPMENT BANK 8C)H 17th. ST. N. WASH I NCi'l ON. DC TKLEPHONE. EX 3 1171 December 11, I969 NR-6U/69 FOR IMhgDIATE RELEASE INTER-AMERICAN BANK LEIIDS $3- ^ ^a:LLION for vocatioiwl eeucation in panama The Inter-American Bank today approved a loan equivalent to $3- ^ million to help Panama improve and expand its public vocational education system at the secondary level. The program will provide facilities to nearly double PanaLia's public vocational school capacity by 1973 to about 9,000 students through a pro- gram of Bchool construction and' expansion throughout the country. It will also improve teacher training services and curriculum in areas geared to the nation's development needs and will strengthen the opera- tional efficiency of the vocational education system. The borrower is the Republic of Panama. The Bureau of Vocational Education and the Bureau of School Construction and Maintenance — both agencies of the Ministry of Education- -will carry out the program at an estimated total cost of $6,330,000. The Bank's loan will cover 53-7 per cent of this sum, and locr^l ronovirc^s wi ll supiOy the remaining U6. 3 P^r cent. The program represents the first phase of a 15-ycar education improve- ment plan, affecting all levels of public education, v/hich v/as adopted by the Governcent of Panama in 1969. ' It calls for a -total investment of about $237 million, of which soire 25 per cent will be devoted to the vocational system- 328 2 Under the first fhase, three industrial arts school;; located In La Chorrora, Los Santos and Col5n and a merchant rr,arine school in Fanaire City will be built; three vocational schools in Ant5n, David and Panai^ City will be expanded, and teaching and laboratory materials, shop equip- ment and textbooks will be provided for four other schools in Divita and Panama City.- The new schools will offer training at the secondary level to some 14,VJ0 additional vocational students, and the expanded facilities, which now Viandle sor.e 1,300 students, will increase their shop capacities by about kO per cent. In addition, up to $375,000 of the loan will be used to help carry out a bread tecVinical assistance portion of the program. Consultants will hired to help the Bureau of Vocational Education strengthen its administration, to develop faculty training and iaprover.ent courses, to develop and teach new courses at the merchant nvarine and vocational schools, and to assist the Ministry in restructuring the present cycle system used in the schools. Panania's urban population— about Ul per cent of the nation's total in i960- -is expected to grow to about per cent of that total by 1^0. ' This growth trend requires exi>anded industrial activities and, consequent- ly, increased needs for skilled labor. Recent estimates project a need for 15,000 additional shilled workers by 1970. However, without the expansion program., Panar.!a's public and private vocational schools viill be able to supply only sor.^e 6,700. 329 3 The vocational schools procrara thus v/ill cover a substantial part of this shortace by providing training for some k,<^00 additional students in such fields as industry, agriculture, iraritime activities, hone-economics and commerce. Today's loan was extended from the Bank's Fund for Special Opera- tions for a -terii of 25 years at an interest rate of 2-1/4 per cent annual- ly. In addition, a service charge of 3/4 of 1 per cent will be charged on principal arcQunts outstanding. Up to $3,060,000 of the loan vxll be disbursed in dollars or other non-Panamanian currencies which are part of the Fund, and the remaining $3U0,000 will be disbursed in balboas. The loan will be repaid in U3 equal semiannual installments, the first of v/hich will be due four years after the date of the loan contract. Principal and interest payrtents will be made in balboas or, at the op-:iori of the borrower, proportionaL+.ely in -thn curren'^ies disbursed. 69/2910 330 INTER-AMERICAN DEVELOPMENT BANK HOB 17Ui. ST. N W. WASHINnTON. D C. 20577 TKKErHONK. KX TJ 4 171 November 26, I969 KR- 58/09 FOR IlvlMEDIATE RELEASE BANK POSTERS AGRICUIffURAL DEVELOPMENT IN PANAMA WITH $6. k MILLION LOAN The Inter-Ace rlcan Developi-Tent Bank today announced the approval of two loans totaling $6. U million to help improve farm and livestock pro- duction and expand grain marketing facilities in Panama. They were extended to the I nstitute de Fomento Econfaico (IFF) , the govemr-ental agency in charge of carrying out Panar.a's agricultural develop- ment plans. Proceeds of tlie loans will be used to help finance the firct stage of a credit prograia for small- .and niediujn-scale farrrers and ranchers through- out the country, and to expand IFE 's storage and narketin^ facilities for such basic grains as rice, com and beans. Total cost of the first-stage project is estimated at ^12. 7 million, of which the Bank loans vfill provide 50. 5 per cent, IFE 28 per cent, and the beneficiaries the remaining 21. 7 per cent. Under the program, credits will be extended to about 2,200 sr.-.all- scale and 8OO mediuTi-scale producers over a four-year period to finance the purchase of farm and ranch nachinery, pure-bred beef and daily cattle, hogs and poultrjs the preparation of lands, and fixed improvements on farms producing rice, corn, beans, vegetables, tomatoes, and oil-:^-! elding seeds. The amounts of credits will range from $10,000 to $25,000 for in- . dividual borrowers and up to $100,000 for agricultural cooperatives. 331 2 Some $630,000 of the loans will be used by IFE to enlarge existing marketing facilities or build new ones In order to Increase Its storage capacity for grains from 13,000 to 20,000 metric tons. These works will also contribute to the agency's national program on price supports and production controlr-. In addition, up to $593,000 of the loans will be used to provide technical assistance to help IFE carry out production cost studies for basic grains; determine the location and design of new storage facilities expand or rei,'.odel existing plants, and provide extension services to the program^s beneficiaries. Agricultural production accounts for ?5 per cent of Panaiiia's gross domestic product. In recent years, however, production in this sector has not expanded as rapidly as 'that of other sectors. This has been due largely to the lack of modern- rrachinery and production techniques and the shortage cf adequate storage facilities. Thus some 30 per cent of Pa- nama' s most important crop — rice--is lost because of this shortage. In view of this situation, the Government of Pana;na has given high priotity to agricultural development, allocating 17 per cent of its total public Investment to this sector during the 1969-72 period. Execution of the credit and marl-.eting program is expected to lead to a 100 per cent increase in rice and corn productivity of the benficla- ries within 5 to 10 years, as well as that of other products. In addi- tion, the income levels of farmers benefited is expected to rise by 20 per cent annually five years after the program has been initiated. The Bank previously has helped finance agricultural credit programs in Panama v;ith two loans to IFE totaling $5. U million. 332 3 . The use of these resources so far have helped generate the provi- sion of soriie 2£,5CO credits to low-income farmers and ranchers. The two loans approved by the Bank today included: — $3. 3 milliop from the Fund for Special Operations for a term of 15 years at an interest rate of 2-\/k per cent annually. In addition, a service charge of "i/k of 1 per cent will be charged on principal amounts outstanding. It will be repaid in 22 equal semiannual installuients the first of which will te due h-l/?. years after the date of the loan contract. Up to the equivalent of ^^2, 155, 000 of the loan will be dis- bursed in dollars or other non-Panaranian currencies which are part oZ the Fund. The ren;aining $l,lI;5,0C0 will be disbursed in balboas. Prin- cipal and interest payments V7ill be cade in balboas or, at the option of the borrovjer, proportionately in the currencies lent. — $3.1 million, also from the Fund for Special Operations, for a tern of I5 years at an interest rate of 3-l/h per cent annually. In addi- tion, a service charce of 3/k of 1 per cent will be charged on principal amounts outstanding. It will te repaid in 22 equal ccniannual installments the first of which will be due k-l/2 years after the date of the loan con- tract. Up to the equivalent of $2,32U^,000 of the loan will be disbursed in dollars or other non-Panamanian currenci'es which are part of the Fund. The remaining $776,000 will be disbursed in balboas. Principal and interest payments will be laade in balboas or, at the option of the borrower, proportionately in the currencies lent. Both loans vlH be guaranteed by the Republic of Panana. 69/2818 333 Mr. Metcalfe. Mr. Tannenbaum. Mr. Tannenbaum. Just one comment. In spite of the grievances Mr. Graham — and I know they are real — I am nevertheless very impressed with the freedom of access you appear to have directly to the Governor. I personally know of no other jurisdiction where a governor has made himself so freely available. I just wondered if you wanted to make a comment. Mr. Graham. Oh, yes, I sure do on that one. Not all the Gover- nors we have had here in the Panama Canal were as accessible as General Parfitt. He beyond a doubt is a very, very exceptional governor. The beauty of it is he talks man to man with your people and I think it makes for good labor relations, and has made for a much smoother understanding all the way around. Mr. Drummond. Mr. Tannenbaum, if I could expand on that, I would like to say that I only wish that that was the case at the lower level. Mr. Metcalfe. Thank you very much. Mr. Sheppard. May I submit in writing a more extensive state- ment covering the information I brought out this morning? Mr. Metcalfe. Yes; we will appreciate it, and it will be so ordered unless there are objections. Hearing none, it is so ordered. [The above referred to information follows:] Rappesentatlve Ralph Metcalfe Chalnaan, Panasa Canal SubcosoBlttee U.S. HoTiee of Representatives Washington, D.C. 20515 Dear Sir: As per yotir instructions daring the hearings your Coanittee held here in the Canal Zone this week, I aa enclosing a written stateoent coTei>ing oral testimony given to you on Vfednesday, April 13th. I have included additional infornatiai i^ich you requested that I obtain and forward to 3rour office. Please take necessary action to insure that the enclosed stateaent is made a part of the record of the hearings. AMERICAN FEDERATION OP TEACHERS, AFI.-CIO LOCAI. No. 29 (MBMDfCR OF CANAL ZONE CINXRAl, LABOR UWIOIC AXD MBTAL TRADCH COUltCnJ BOX 3183 BAI.BOA. CANAL ZONE BOX ass OOCO SOLO, OANAL ZONTt April 14. 1977 Ralph 0. Sheppard President, Local 29, A.F.T. 334 AMERICAN FEOKRATION OF TEACHERS, AFI^-OIO LiOOAL No. 29 (memdrh or CANAi. ZONE cEirrHAi, uaon vtnon Awn wtal tkadh ooowcii.) BOX 81«3 BOX MS BALBOA. CANAL ZONE OOCO SOLO, OANAL ZONV THE EXPANDED STATEMENT OF LOCAL 29, AMERICAN mKRATION OF TEACHERS, IN ACOORDANCZ WITH THE UNANIMOUS PERMISSION OF THE PANAMA CANAL SUBCOMMITTEE AT HEARINGS HELD ON APRIL 13. 1977, TO BE INCLUDED IN THE RECORD OF SUBJECT HEARINGS The Canal Zone Fedsratlon of Teachers, Local 29 of the American Federation of Teachers, wishes to thank the Chalntan and the Comittee for this opporturiity to expand on oral testinony that was given before the Connlttee on April 13, 1977, tgr Ralph 0. Sheppard. 1. The Teachers of the Canal Zone desire to insure that the quality of educa- tion in the Canal Zone reaains at its present high level. However, there are several factors at the present tine which have adversely affected the norale of the Teacher force. Anong these are questions of Job security, atteapts to withhold raises which have been paid to other Teachers on the saas pay baee, lack of any transfer oppor- tunities at present or in the future, the oategorication of Teachers into an excluded group under Civil Servioe, and the future of the Canal Zoos College. 2. The najorlty of Teachers who cans to the Canal Zone did so for the purpose of a full career with the Canal Zone Govemaent. At tnat tia», Jobs were also plen- tiful in the United States, but the individual Teachers elected in accordance with recruiting literature and proaises froa the Canal Zone to take a position here ra- ther than in the United States. Although Teachers are selected un a foDJy qualified basis, they do not have to take a eoapetitirie ezaalnation and are thus placed in an excluded category of eqiloyees not eligible for transfer to any other branch of the Civil Service. Due to the inferenoe of full career eaployaent within the Canal Zone, this did not appear to be too important a point at that tiae. Today it looss as a prias factor - and in the event of a new treaty irtiich does not ppovide for a continoed school systea at the present level in the Canal Zone, aany teachers at advanced ages, top levels of oonpetenoe, educational qualifications, etc., will be looking for positions in «n already overorowded Job aarket in the teazling field. As you know, at this tiae, school boards in the United States are tiding to out doan on expenditures and are not seeking Teachers with advanced degrees sud years of experience! 3. Sons possible aethods of alleviation of these probleas are as follows: (a) Your assistance is being sought through legislative or administrative actions 335 to remove the Teachers fron an excluded category and to aahs them eligible for other ClTil Servioe poeitiona for which they nay be qualified, (b) Provide for lateral transfer into other U.S. GovemBent educational program, such aa Health, Education and Welfare, the U.S. Trust schools. Bureau of Indian Affairs, and Departaent of Defense schools - ifith credit for all Federal employnsnt or other educational experience. In case of a reduc- tion in force in the Canal Zone, we request that a 'stopper list" be established - whirfi loeans that Canal Zone Teachers on that list be hired prior to recruitment of new personnel from outside the Federal system, (e) Take actions to insure that Teachers who reimLin in the Canal Zone if a new treaty is signed are maintained on a pay base equal to that which they now have, even thou^ another entity should acquire the responsibility for operation of the schools here. With the exception of Teachers, Police and Firemen, all other employees have been assured of this protection, (d) Insure that the Canal Zone C-ollege will continue to function in providing higher educational facilities to U.S. Department of Defense and Canal Zone employees and others who presently utilise this educational advantage, (e) In case of an adverse decision by the Ccxaptroller General on the retroactive pay situation now being considered, we request assistance in obtaining legislation to prevent reourrenoe of this \mf air loss of pay. (f) Assistance is asked to insure that realistic good faith consultations are made available to the Teased upon the Canal Zone Teachers. This was done in spite of an agreement between the Schools Dirision and the two U.S. TeaAer Unions that if the Union members did not ratify the agreement, it would be null and void. One of the Unions did not ratif y - however, the school year was lengthened anyhow. At that tins, the Schools Division representative used as a portion of his argument for the action that the Washington D.C. school year was going to be lengthened and that we wotild be doing this Mily a short period of time ahead of them. When the Washington D.C. school year was not lengthened, our Union requested consultation on August 14, 1975. The Governor replied on September 8, 1975i that when a new contract between the Teachers Union and the District of Columbia Board of Education was approved, consultations between the local Unions and the Canal Zone school officials would take place. The D.C. cwtract has been ratified. After cwisiderabla delay, the Teacher met with the Superintendent of Srfioole - only to receive a flat NO on any approach toward co»- parability between the Washington D.C. school year, hours, or pay per houirs for the Canal Zone Teachers. The only concessicm made by the Superintendent after being advised that we would have to press further was to suggest that we submit a package for study. His stand on no adjustment of days, hours, or minutes leaves a hi^ feeling that the preparation of 336 this paokmge will be Just another act of futility on our part. However , a package will be prepared and forwarded to the Superintendent. (Copy of Qovemor Parfitt's letter is ap- pended). We again draw your attention to the fact that the Governor apparently recognites our problems, but la frxistrated at the lower levels. km The Chairnan queried as as to how well prepared were the students fron the Latin American Schools for college entrance. I have obtained the following information Arom the Assistant Superintendent of Schools (Latin American Schools). The Latin American Schools have foxu* tracks for their students - only one being for college preparation. Year Total number Known ijjimber of graduated students attending college 1971 200 61 1972 193 49 1973 163 38 1974 No data 1975 105 29 Students presently enrolled in college prep courses: Grade 9 24 students 10 27 11 33 - 12 29 I have no personal knowledge of how well prepared each individual student is. How- ever, the majority of their Teachers have been examined by an evaluation committee and have been found qualified to teach U.S. students. I should certainly be entitled to assume that their prior Instruction has been of a high caliber so that their students would be able to function well in relationship to national norms. In discussions held with members of the Latin American Communities, some parents with children in other than college prep courses are showing considerable alarm at the possi- bility that these students will not be able to finish their high school courses in the track system in i^ich they are presently Involved. I also reiterate uy strong position that U.S. oltlxen cdilldren should have U.S. dtlien Teachers in all situations where they are tau^t such things as history, civics, patriotism, American culture, customs and traditlcns, and all-around appreciation of the Anrican way of life! Although it may be true that the majority of ncffi-U.S. dtisen Teachers would not attempt to indoctrinate or influence students with other philosophies, we do not believe we can afford to take any chances with children in the formative stage. Opposition to Instruction of U.S. students by foreign nationals is clearly stated in laws applying to Department of Defense schools. The Canal Zone Federation of Teadiers is in agreement with the position stated by APCE Ik on the necessity for obtaining retirement credit for previous teaching experience in public schools - in accordance with the method that this benefit is available to the Teat^rs in the Washington, D.C. , sdiool system. Page 3 337 CANAL, ZONE GOVERNMENT BALBOA HKIOHTH. CANAL ZONE Offick of the Oovbrnok SEP 8 1975 Mr. Kenneth H. Hannah, President American Federation of Teachers, AFL-CIO Local No. 29 Box 263 Coco Solo, C .Z. Dear Mr. Hannah: This is in reply to your letter of August 14, 1975, in which you address the issues of the length of the school day and year and sick leave. My predecessor. Governor Parker, approved tfie proposal submitted to him in September 1973, which was the result of consultations between the teachers' unions and the Division of Schools officers. An important port of tfie agreement states: "... any change in any of the leave policies, school year, or school day in the District of Columbia will result in further consultations between the Administration and the Unions toward t+ie end of maintaining and increasing reasonable comparability . " I am informed that the current situation in the District of Columbia, particularly in relation to the length of the teachers' work day, is very unsettled. When a new contract between the teacher union and the District Board of Education is approved, consultations between the local unions and the Canal Zone school officials will take place. Sincerely yours. Governor 0-77-23 338 Mr. Metcalfe. The next group will be the Panama Canal Atlan- tic Side Dock Workers' Union. Mr. Anderson will interpret for Mr. Delgado, who is the General Secretary of the Union. STATEMENT OF MR. JOSE L. DELGADO, GENERAL SECRETARY, PANAMA CANAL ATLANTIC SIDE DOCK WORKER'S UNION, AC- COMPANIED BY FRENANDO WILLIAMS AND LUIS ANDERSON Mr. Delgado. Dear Sirs Mr. Chairman, it is my pleasure to present Mr. Luis Anderson, who is going to be acting as interpreter for my presentation. The Panama Canal Zone Dock Workers' Union, in its constant concern over any issues which might unfavor- ably affect the interests and welfare of the Cristobal and Balboa Dock Workers, hereby submits to your committee the following inquiries in the hope of obtaining a satisfactory explanation. At the signing and implementation of a new treaty between Panama and the United States over the Canal and its zone what responsibilities will the U.S. Government assume with regard to the economic, social and labor interests of Panamanian and non-U. S. workers in-service and retired employees? Who will administer the Cristobal and Balboa docks under a new treaty and what will be the status of their current employees? What is the reason behind the proposed new job grading stan- dards for local manual workers which will adversely affect dock workers by downgrading their classification of MG — 7 Stevedores to MG-2 and MG-3 Laborers and Stevedore Workers. Does this stem from current negotiations for a new Canal treaty? We wish to express our apology for not preparing properly due to the fact he received late notification about the meeting today. I wish to elaborate on the three points presented. Following the analysis we have made of the 15 points presented we all know of, they are a matter of concern to us because amongst them there is not clearly defined the content of three specific points. The first is point 7, then points 12 and 14. Number 7 refers specifically to the Social Security System of Panama. We find it is not clearly defined as to what will happen to those workers of less than five years experience who will compulsorily pass to the Panama system. We understand that all of us pay a premium for health and hospitalizaiton insurance. What will become of the moneys that the workers have paid when they go under the Social Security System of Panama? On Point 12, in reference to the conditions of employment of non- U.S. citizens that will have to abide by the labor code of Panama, in relationship to employment. Number 14 that relates itself to dealings with unions that should be recognized based on the Order 11491, and its amendments. These points conflict in that one addresses itself to conditions of work and one addresses itself to labor unions and they imply that there might be two types of administration, whereas we know that under the Labor Code of Panama, both aspects are taken into account. That is in reference to the first part of my basic statement. The second point we brought here because we understand that we work in a place that other than just serve, a good service to the 339 Panama Canal Company and the United States Army, the relation- ship to the handling of materials and other cargo, it is also devel- oped into commercial-type work. Therefore, we believe that under these conditions that we under a new treaty will be left aside or excluded as far as addresses the present Panama Canal treaty. In view of this it is our concern and we request you to classify these different aspects. The third point we refer to is something that was given to us several months back. It was proposed to change the grade levels of certain workers of certain divisions that included ours and that it would have a most regressive effect on the rights already acquired not only by the dock workers but by the other workers in the Zone as well. Apparently they must be withdrawn by what we consider them to be, not prudent. Mr. Metcalfe. Could you speak a little louder so they can hear in the back of the room, please? Thank you very much, Mr. Delgado. May I make a statement that we are mindful of your questions on worker status under a new treaty, but at this time we cannot answer them — I think you understand — because the treaty negotations are ongoing. We will be mindful of all of the points that you raise with regard to the 15 points of agreement issued by Governor Parfitt. We will be mindful of that. Mr. Delgado, could you submit a list to the subcommittee of the manner in which the new job grading standards affect your membership? Mr. Delgado. These standards are now in the proposed stage and I do not have a listing now but could make it available later. Mr. Metcalfe Very good. I have specific reference to your letter to me of April 6, Roman Numeral 3. That is what we are asking for. You will submit that then? Good. Mr. Metcalfe. The Chair now recognizes Mr. Modglin. Mr. Modglin. Mr. Delgado, you made reference to the question of the disposition of docks and piers under the new treaty. I take it the main concern of your organization is that benefits and protection that you now enjoy would, regardless of the status of those docks, be continued under a new treaty? Mr. Delgado. That's a part of it. The other part is that the new treaty the administration is going to change under a new treaty. Mr. Williams. In other words, what he means to say is in case a new treaty was to come into effect, what would become of all the dock workers if another party takes over? Mr. Modglin. One further question, Mr. Chairman. Your union is not affiliated with the AFL-CIO? Mr. Williams. No. Mr. Modglin. How then do you intend to make your voice known with respect to what happens in treaty negotiations? Mr. Delgado. This is something that is free. We are affiliated to the Confederation of Workers of the Republic of Panama, which is the one to which we are affiliated and has ties with the AFL-CIO. Mr. Williams. In other words, what we mean to say, sir, is right now we are 2 unions in the territory of Panama, that where ours is, 340 11th Street, in other words, whatever goes on on the Panama side, we got to know what is going on becuase we are part of the body. We work for the Canal Zone, and also we are a group on both sides. Whatever we have of a union on the Panamanian side, whatever goes on, we've got to be a part of the body. We are working on the Canal Zone side, so we have to know what's going on here on this side. In other words, if they have a meeting here in Balboa, Mr. Simoneau, he will give us a call and invite us, so everything that goes on we are up to date with. Mr. MoDGUN. Are you familiar with the provisions of the recom- mendations of the AFL-CIO, and do you subscribe to and do you agree with those recommendations? Mr. Delgado. I am not aware of those. Mr. Williams. What we are looking for is equal rights. In other words, we are looking for betterment of our people. We are not looking for lower costs of living. The cost of living is going up and when it goes up, the people are looking to make more money. In other words, the dock workers, like, they go to work. When there are ships, we work. When there are no ships, we don't work. We don't get paid. We work according to the basics of the ship. If the ship comes to the port, we make money. When ships don't come to the port, we make nothing. In other words nobody guarantees us nothing. When you work you get paid. When you don't work you have nothing. Mr. Metcalfe. Thank you. Mr. Nonnenmacher. Mr. Nonnenmacher. Mr. Delgado — if you could answer for him — I understand you have affiliation with a Confederation of Panamian Unions or a group under some name like that. I w^ould like to ask the specific question, is there a Panamanian dock workers union? Mr. Delgado Yes. We have two. Mr. Nonnenmacher. Could you give us an idea of their size compared with your membership which I understand is about 370 members'!^ Mr. Delgado. There are two unions, and they have approxi- mately 115 members each. Mr. Nonnenmacher. Inasmuch as the Canal Zone has the chief dock facilities, I was interested in that answer. That is the answer I sought. Thank you very much. Mr. Metcalfe. If there are no further questions, thank you very much, Mr. Delgado, for your presentation. You may be excused. I would like to keep the committment made to Mr. Anderson, so if the other gentlemen v^ll absent themselves from the table I will now give you five minutes, Mr. Anderson, to represent yourself, and speak as president of Lyocal 907 of the American Federation of State, County and Municipal Employees. Mr. Anderson, if you will speak up a little bit louder so the people in the back of the room will hear you. 341 STATEMENT OF MR. LUIS ANDERSON, PRESIDENT, LOCAL 907, ARMED FORCES EMPLOYEES UNION Mr. Anderson. My name is Luis Anderson. I am president of Local 907, Armed Forces Employees Union, AFSCME AFL-CIO. Sir, you have a letter that I wished to present to you. Due to the fact I was not invited to make a presentation at this meeting, I want to express my thanks for giving me the opportunity to read this letter and bring out points that are a matter of concern to our union. I will be happy to answer any questions that you deem appropriate. In view of the fact that Local 907, Armed Forces Employees Union, AFSCME, AFL-CIO, representing over 2,000 employees of DOD agencies in the Canal Zone, was not invited by the administra- tion of the Panama Canal Company-Government, to participate or make a presentation in the meeting with you and your distin- guished colleagues, we use this medium to set forth our views on those subjects that we believe should be brought to the attention of the subcommittee you so ably chair. It has been a matter of great concern to our union and to all non- U.S. citizen employees of the different agencies of the Government of the United States that operate in the Canal Zone, the fact that a document made public by Governor Parfitt putting forth the posi- tion of the U. S. Government regarding securities sought for em- ployees of the area under a new Canal treaty, is a forthright attempt to legalize injustices and discriminatory practices of the past, by creating different conditions of employment based on nationality. Local 907 has fought many battles to gain and preserve equality for all workers of the area. It has been a slow and painful road, at which end we have not reached. We must, therefore, reject in the strongest terms possible any attempt to relegate non-U. S. citizen employees to a category of second-class workers under a new treaty, regressing as appears to be the intent, to a sophisticated version of the Gold and Silver Era. It must never be forgotten that as a group they have been loyal, dedicated, and have contributed, since the Construction era, in unmeasurable quantities to the Canal effort. Consequently, we request that through the House Panama Canal Subcommittee, the U.S. House of Representatives be urged to main- tain a position in defense of equality for all employees of the Panama Canal area under the forthcoming Panama Canal Treaty. Two, Local 907 has protested the application of a cutoff point in the wage scale in the Panama Canal Zone since its inception. The flagrant violation of the intent of the Memorandum of Understand- ing of 1955 between the governments of Panama and the United States with regards to the creation of a single wage scale, has been magnified and accentuated by the inclusion of grades NM4 and NM5 in the Canal Zone Wage Scale on 4 July 1976. Hundreds of employees in grades NMI through NM3 have toiled and sacrificed for many years in gaining the expertise and academic level that will permit them to fill the stringent requirements of the higher positions, only to find that through the application of the 342 archaic management philosophy contained in Public Law 85-550, their efforts were in vain. Local 908 requests that action be initiated by the House Panama Canal Subcommittee to modify the regulatory provisions which providies for the above stated injustice, so that all employees in grades NMI through NM3 on 4 July 1976, be permitted to earn retained rates [U.S. Wage Scales] when promoted to grades NM4 and NM5. Workers of private concerns in the Panama Canal Zone, conces- sionaires, contractors, commercial firms, et cetera, presently are subjected to conditions of employment that are an affront to the concept of social justice within a democratic structure. The Panama Canal area that serves as a show place for United States ingenuity, engineering ability and prosperity, maintains over 1,000 Panamanian workers in a state of abject debasement as far as the basic labor benefits are concerned. The non-application of U.S. or Panamanian labor laws provide for the exploitation of these workers by private employers whose only concern is fat profits. Further, it appears that the aforementioned is accomplished with the complacency and/or approval of the higher administration of the Canal Zone, who time after time have either become deaf or looked the other way, when this union has sought reprieves for that large group of workers. Benefits not afforded them include but are not limited to: 1. Annual leave; 2. sick leave; 3. retirement; 4. job stability; 5. right to unionize; 6. medical and life insurance; 7. severance pay; and 8. classification system. We urge you to immediately initiate action to correct a long- standing injustice, so that these workers and their families can, by means of their daily toiling, live a decent and decorous existence. Four. In July 1975, non-U. S. citizen workers of the Department of Defense Non-Appropriated Fund Instrumentalities in the Canal Zone were finally included in a Retirement and Health- Life Insur- ance Program. Minimum requirements for inclusion in these pro- grams are so stringent that more than 80 percent of all Non-US NAFI employees are presently excluded from participation. Local 907 has requested from all agencies involved that all employees of this group be placed unde the Social Security System of the Republic of Panama with retroactive coverage that will permit the senior employees to obtain a decent retirement pension during their later years. Inclusion under Social Security would provide not only retirement benefits but would also include medical and dental services for the entire famiy, plus hospitalization. In view that DOD agencies have started discussions with Social Security officials in the Republic of Panama, along the line delin- eated above, Local 907 requests the auspices of your office to speedily secure this much-needed development. Mr. Metcalfe. Thank you very much, Mr. Anderson. Let the record show your statement will be incorporated in the record of these hearings. I would like to also clarify one thing. You indicated that you were not invited to these hearings by the Administration of the Panama Canal Company/Government. These hearings have been arranged in cooperation with the Panama Canal Company and the Subcom- 343 mittee on the Panama Canal so we both worked together to try to estabUsh the agenda for these meetings and they of the Administra- tion are not totally responsible for any omission, and we are as much a part of that omission as they are. Mr. Anderson. And I would like to state for the record also that this is not the first time that something like this happened. Mr. Modglin explained to me the mechanism that is used to invite the different unions. Local 907 is excluded from certain labor activities under the excuse that we only represent members in the Department of Defense. To a certain point this is a fallacy because DOD agencies in the Canal Zone usually follow suit on all labor- management issues. So probably you will be expounding on the causes that you know of advise and consent by excluding 907. By the time it gets down to our level it is already decided on the Panama Canal level. So what I would like to see is the Department of Defense representative, their representatives be afforded the opportunity to participate in all labor discussions in the Canal Zone. Mr. Metcalfe. Mr. Anderson, I think that can very easily be corrected. There was no correspondence between your local and the committee heretofore and we will include you in any future hear- ings we may have. You may rest assured your voice will be heard. Mr. Hillis. Mr. Hillis. No questions. Mr. Metcalfe. Mr. Nonnenmacher. Mr. Nonnenmacher. I have no questions. Mr. Metcalfe. Mr. Tannenbaum. Thank you very kindly, Mr Anderson. STATEMENTS OF JAMES J. O'DONNELL, PRESIDENT, AND DAVID BAGLIEN, LOCAL NUMBER FOURTEEN, AMERICAN FEDER- ATION OF GOVERNMENT EMPLOYEES Mr. O'Donnell. Mr. Chairman, this is Mr. Dave Baglien, member of Local 14. I would like to bring out a few points before I start. AFGE is composed of 90 percent U.S. citizens. We have about 800 members. We represent Army, Navy, Air Force and the Panama Canal. One of the things that was brought out here earlier was the fact that maybe a change would take place and labor laws wouldn't apply. I would like you to know that AFGE is represented in Germany, Italy, Africa, Spain, Guam, Virgin Islands, Puerto Rico, Okinawa, as well as here, and I am sure other areas overseas. Federal laws apply to these U.S. workers who work overseas so I don't envision any problem with AFGE functioning in this area if and when a change in the treaty takes place. Someone mentioned the fact that these assurances did not apply to the armed forces. That is very true. I recognized that when they first came out. I sent a letter to General McAuliffe, the command- ing general here in this area, bringing this to his attention, the fact that the 15 assurances, in an oversight, left out the fact that they only addressed themselves to Panama Canal employees. As of this date General McAuliffe hasn't answered this question. The chair- 344 man has asked who it should be who would address the problems of armed force civilians and the answer, in my opinion, is General McAuliffe because he is the one who speaks for all of the civilians here in the DOD departments. Congressman Metcalfe, I would like to take this oportunity to welcome you and the members of your committee to the Canal Zone. I am James J. O'Donnell, President of Local 14, AFGE, the largest single United States citizen union in the Canal Zone. Your visit to the Canal Zone is very timely because the workers are deeply interested in having frank, in-depth discussions with mem- bers of Congress on problems which affect the Canal Zone work force. Would you believe that we have been discussing treaty labor protections with United States Government officials like yourselves for 13 years? For example, in 1964, we were told that the adminis- tration was desirous of having frank and open discussions concern- ing organized labor's ideas for protecting employees if and when a treaty takes place. In 1967, we thoroughly discussed the proposed treaty concepts with our members, and later produced a paper on the types of labor protections that we would like to see in the treaty. We wanted this list of protections included as a labor annex which was part and parcel of the treaty. We were told in 1967 that this matter was considered urgent, and that higher officialdom would not lose sight of the very important consideration of fairness to all employees. Today, fully ten years later, nothing has yet been done, at least to our knowledge, to include labor protections in the treaty negotiations. Under your former chairman. The Honorable Leonor K. Sullivan, your committee has visited the Canal Zone on many occasions for the express purpose of obtaining the views of employees. I believe it can be safely said that over the past ten years your committee has been more informed on the problems and aspirations of the Canal Zone workers than any other body. However, I believe it is still worth repeating that the apprehension that exists here today among our employees can be attributed almost solely to the absence of factual information and proper consultation pertaining to job security and to our future working and living conditions. There is agrement among members of Congress, our Ambassa- dors, and other officials of the State and Defense Departments, including Mr. Cyrus Vance, that we have a right to know how a treaty will affect us, and that we should be consulted and kept informed. You can imagine our dismay when some of our union people talked to General Torrijos in February and he said that the U.S. negotiators had never yet mentioned the matter of employee rights under a new treaty. It was only last month that we received a small indication that the administration was trying to do something to alleviate this situation when Governor Parfitt made public fifteen assurances concerning employee rights that would be asked for under the treaty. Local 14, AFGE, views these assurances in the same light that the treaty negotiators view the eight point Kissinger-Tack agreement. These assurances are simply a general base on which a great deal of work has still to be done in order to produce specific 345 and viable solutions to the many and complex problems to be resolved. For example, assurance number fifteen reads as follows: ''Recommendations, if appropriate, will be made to the Office of Management and Budget for legislative action found necessary to prevent an erosion of the general level of employee benefits and conditions of employment under any new treaty. ' We are extremely interested in knowing when a committee of congress might hold hearings on any "appropriate legislation" that will be necessary to provide Canal Zone employees with labor protections. Congressman Metcalfe, is there any reason why your committee cannot introduce a bill or resolution that would bring pressure for our labor protections to be included as a labor annex in the forthcoming treaty with Panama? Time may indeed be short. I have been informed that the United States negotiators for a new Panama Canal treaty reaffirmed to the Senate comittee early this month that the Carter Administration fully expects to reach a new agrement with Panama by June of this year. In view of the very limited time at our disposal, I respectfully requset that your committee again review our labor protections position paper, and that you take steps towards securing these protections in the treaty as a labor annex. I have included a copy of the labor protection paper for your review. [The following was submitted for the record:] 346 RECOMMENDATIONS OP THE AFL-CIO COMMITTEE ON PANAMA CANAL TREATY NEGOTIATIONS BETWEEN THE UNITED STATES AND THE REPUBLIC OP PANAMA In recent veeka, representatives of the United States and the Rep\iblic of Panama have initiated discussions aimed at producing a new treaty gov- erning the administration and operation of the Panama Canal. * This development underscores the need for the representatives of the two governments to extend serious considerations to the effects of a new treaty on employees now operating the Canal and its appertunances. Citizens of both nations have made an invaluable contribution to the construction and continued operation of the Canal as a vital water- way serving world commerce. Large numbers have devoted their entire working careers to the successful ftmctloning of the enterprise. Whatever agreement emerges from the current blnational discussions, the Panama Canal will continue to serve its essential function of transmitting ships of many nations from ocean to ocean. The work force necessary to accomplish this mission deserves the utmost consideration in any accord between the United States and the Republic of Panama. For these reasons, the Committee has addressed itself to the conditions which should prevail for three groups of workers now engaged in Canal operations and related activities. / Employees whose Jobs would be eliminated. Employees who would continue to work for the reorganized Canal function. Employees who choose not to work for the restructured Canal organization* 347 Benefits for Employees Whose Jobs Would Eliminated. A. Early Retirement. 1. Any employee of the Canal Zone Government /Panama Canal Company subject to Civil Service Retirement Law who becomes absolutely separated from employment for any reason other than misconduct or delinquency shall be considered as Involuntarily separated within the meaning of the Civil Service Retirement Law and shall * be eligible to retire with 15 years of service, regardless of age, with no loss In annuity or reduction because of age. •' 2. Extra credit of one year service for cachj five years total - United States government service. .r 3. Provision for a minimum retirement benefit of 50Z of salary - at the time of retirement; ~ — - - ■ ----- r:.- r: 4. Coverage under this section 'for those who lose their Jobs in changes made in anticipation of the treaty, as veil as after" ' ^ treaty becomes effective. ~~ zrs-^-.. ... ^.'^'5. The above benefits i^hall apply also to employees in the Zone ^V"' who are similarly affected^ but are not covered by the Civil'' ^Service Retirement Act. The cost of these benefits would be ' defrayed wholly by the employer. ' --i--- ^- - B?'' Severance Pay and Unemployment Benefits. ^ ^-"-1; Severance pay and other appropriate benefits will be provided to'ciishion the impact of separation. j2. Unemployment benefits for those employees laid off as a result of tha treaty will be paid until such time as they obtain other employment, l^b minimtm waiting period will be required and 348 -2- . maximum weekly benefits payable^ in the United States will be applicable. 3. Non United States citizens severance and unemployment benefits described above shall be made available to both United States and Panamanian citizens, the cost to be borne by the employer. Placement Assistance. !• The facilities of the administration and the Republic of Panama shall be used to the fullest extent to secure career employment for transferred employees, other than United States citizens, who after transfer to the administration are Involuntarily separated at any time from the service. 2. The United States government will provide placement assis- tance in federal positions in the United States for which they may be qualified by experience and training those employees who are United States citizens and who are involuntarily separated at any time from employment because of the treaty. 3. Whenever a function of the administration is transferred to the private economy, the administration and the Republic of Panama shall make. fair and equitable arrangements to protect the Interests of all employees who presently perform such functions, including the transfer of the employees with the function under the same conditions of employment. The terms and conditions of such employment arrangements shall be specified in a written agreement between the administration and the Republic 349 -3- of Panama. Such arrangements shall Include provisions neces- sary to protect individual employees .against a worsening of r their positions with respect to their employment and to assure - compensation and benefits at levels not less than those applicable to such employees immediately prior to the effec- ^ - tive date of the agreement, including provisions necessary to: * (a) assure continued employment; _ (b) preserve rights, privileges, and benefits (including e— . . continuation of pension rights, credits and benefits) ci.:.: under collective bargaining agreements, or otherwise, -t:.:. _ in effect on the effective date of the agreement; - 2. Zzit (O- continue collective bargaining rights; ■ t£- (<1) provide paid training and retraining programs. II. Protection for Those Employed by the Restructured Canal Administration A. Employment Benefits and Protection* l^^Protectlon and benefits at least equivalent to those, in c /effect Just prior to the effective date of the treaty such as: ♦-A. Ovettlme Pay. .b. Night Differential. : Reinstatement and Restoration of Individuals. ^^^-^ Injury and Death Compensation. Uniforms and Protective Equipment. _t>.. Leave Time. ^g.._ Free periodic transportation of employees personal vehicle. 350 -4- h* Travel and Transportation Benefits for Homa Leave. !• Group Health and Life Insurance j. Repatriation of Employees Families personal effects and Household Goods. k. Education Travel. 14 Transportation of the Remains of Deceased employees as well as their families, personal effects and household *- ' ~ goods . , / - m. Transportation of the Remains of Deceased Dependents. n. Witness Fees and Allovances. o. Reduction in Force Procedures.: _ - p . Grievance Procedures and Appeals . . q. Adverse Actions and Appeals. r. Position Classification System and Appeals. 8. -Veterans Preference -Eligibility. t. -Holidays. - r^. _ " u. Incentive Awards Program. ^_ : ^ _ . . - ■^~ " v^ Salary Savings. ^ *w.^^ Severance Pay Benefits. ^ ^*x." Hazardous Duty Pay. -- - - . y. Social Security. 2. Provision of a waiting period of fifteen years after ratlf 1- " cation prior to enforcement of the new treaty with regard to ~ changes in -the work force 3. Continuation of recognition. of United States, labor unions ~' and United States labor standards. A, A guarantee that no employee will be reduced in compensation below that which he last received as an employee prior to the 351 effective date of the new treaty. 5* Application of an adequate tropical wage differential for United States citizens. 6. The application of wage increases received by United States government employees to the Canal administration. 7. Coverage by the United States Civil Service Commission Retire- ment Law so long as an employee continues with the Canal admin- * istration of United States government. 8. Provision for equal opportunity for both United States and Panamanian citizens to Job openings and promotions. 9. * Provision for salary increases to offset any net Increase in the^ cost of living or other net financial disadvantages which .such employees might otherwise suffer. B* The administration shall provide adequate community services for all its employees, to be. maintained at the standards existing prior to the entry into fo'rce of the treaty, such as, but not limited to, housing, schools, medical, hospital and related services, as. well as protective and security services or functions, such as police, fire. Judicial and all other civil service benefits accumulated by. the employees prior to the enactment of the treaty. . ^...'^ III. Benefits fox those Who^ Elect not to continue Employment with the Canal Administration following Treaty Implementation. A. Placement Assistance and Severance Pay. 1. Severance pay and placement assistance will be given these workers as if they had been involuntarily separated such as those workers in Category I. 352 B. Early Retirement. 1. The early retirement benefits provided workers In Category I will be provided to workers who elect not to continue employ- : nent with the Canal administration following treaty implementation. C. These rights will be retained as long as the employee continues with the Canal administration, and can be exercised at any tlme» including the period prior to the actual effective date of the treaty. IV. Collective Bargaining At The principle of collective bargaining between the employer and unions for en^loyees they represent shall be recognized and maintained . : - We recommend that the above benefits and protection be written into' the treaty and that enactment of legislation by both Panama and the United States to carry out these provisions be made ~a part of the condi- tions for final ratification. 'The language of such legislative proposals should be: developed prior to ratification, and should be available to the AFL-CIO Committee for examination and comment. 353 Mr. O'DoNNELL. We had a second problem that I would like to have Mr. Baglien present to you. Mr. Baglien. Mr. Chairman and committee members, the AFGE would like to present a rather specific request for action on behalf of the Canal Zone teachers for a privilege that the District of Columbia teachers has had for over fifty years. It appears right now that positive executive action on behalf of the Canal Zone Govern- ment is not going to be forthcoming so we are requesting action from your committee. The educational personnel in the District of Columbia are autho- rized under the provisions of Public Law 624 of August 7, 1946 to buy credit in the D. C. Retirement System for prior educational service to a maximum of ten years. This same procedure is also already available to educators in most of the fifty states. It is recommended by the Council of Chief State School Officers for adoption of all remaining states. Most educational personnel arrive in the Canal Zone with several years of prior service. Typically, they do not have at the time of retirement nearly as much service as other Panama Canal personnel. In view of the uncertainties now facing the Panama Canal future, I ask that educational personnel here be authorized to purchase credit toward retirement for prior service on the same basis as do educational personnel in the District of Columbia. An Amendment to any appropriate piece of legislation might read, "Educational personnel in the Canal Zone are authorized to purchase credits for prior educational service towards U.S. Civil Service retirement on the same basis and under the same condi- tions as authorized for educational prsonnel in the District of Columbia by Public Law 624, August 7, 1946." I would like you or your committee to introduce a bill or an amendment such as above suggested so the canal Zone educators might receive the same retirement benefits as their compatriots in the District of Columbia have had for the last 57 years. Mr. Metcalfe. I might respond to both you gentlemen by saying that we have had, we do have now a communication making that request. We are researching it. It is very complex. It is not as easily done as one would hope that it could be done because of the different rules and regulations, but certainly we are interested in it and we have not disregarded the statement that you have made, nor the request that you have. Mr. O'Donnell, I notice on page two in your statement — are you suggesting labor protection legislation be introduced prior to con- gress dealing directly with the new treaty? The reason I raise that question is that the procedures as we have learned since we have been here are the negotiators want to agree to a set of principles and then they feel that everything will fall after that. But we are mindful of the fact that when and if there is a treaty that is going to be agreed upon, it will be at that point that congress will be looking at enabling legislation. The Senate, of course, will have the right to ratify if they vote to do so. We have the right for the disposition of any land. There will be some legislative procedures. 95-549 O - 77 - 24 354 We cannot, at this moment, proceed to draft legislation until we know that there is an intent on the part of both sides of the negotiation table. I think we ought to be clear on that. Mr. O'DoNNELL. Mr. Chairman, but the workers here have a great fear we are going to have a treaty and there will be no protections and that is why I proposed the resolution I gave to you. Is there any reason, Mr. Chairman, that a resolution cannot be introduced into Congress that would say that if there is a treaty, local protections will be in the treaty? Mr. Metcalfe. No, there is not. As a matter of fact, I wanted to comment on that to say that the ruling I just mentioned I think does not apply to your particular request. I think we can proceed to draft up this resolution. Mr. O'DoNNELL. It would be very helpful. In fact, in 1955 we had the Remon-Eisenhower treaty and if my memory serves me cor- rectly, it was three years later that they had the implementing legislation. Between the time that the treaty becomes old and passed and three years later, according to what we read in the Panama press, there won't be much left here, so by the time Congress gets around — if we do the same as we did in 1955 — why most of the people will be gone before they get to the legislation. Mr. Metcalfe. Mr. O'Donnell, you understand we have to know what's in the treaty. We do not now know, nor do the negotiators know, and once they sign the letter of intent that these will be the issues, we can then move with dispatch in terms of introducing enabling legislation. Mr. O'Donnell. Mr. Chairman, there is something else we have a fear of. For many years we have been asking officials to speak to us about labor protections and they all say generally what you have just said, which is, ''Wait until we finish the treaty, then we will talk about labor protections." Mr. Metcalfe. There is a difference, Mr. O'Donnell. The differ- ence is, we have to know when we are — what the resolution will be, what the enabling legislation needed here will be before we can draft it, and we won't know that until we get the word that there is an agreement — and this is prior to the official signing of the treaty agreements. But it is only after we know what points we have agreed on and plan to initial that we can act. Do you care to comment on the difference between the labor annex written in 1971 and the assurances written by Governor Parfitt? Mr. O'Donnell. I tried to bring that out here in my first para- graph on the second page. It was very nice of General Parfitt to present that, we appreciate it. It was a step in the right direction, but it is a very small step and it is a tremendous amount of work that has to be done between that paper of 15 assurances and the labor protections we are desirous of. Mr. Metcalfe. Mr. Zeferetti. Mr. Zeferetti. I have a short question. You talk about labor protections and yet some of the civic councils we heard testify yesterday, were concerned with human rights protection. One of the things I asked earlier, of one of the other gentlemen, was this, do you feel as strongly as some of the U.S. employees feel, about 355 keeping the present judicial system intact. Would you want the present law enforcement and criminal justice system as a whole, to stay in place while these negotiations go on and one treaty is in operation? Mr. O'DoNNELL. The only way I can answer that, Mr. Zeferetti, is — and I have taken a verbal survey; I also have one in writing right now; it is in process, to determine that point. If the employees are fully protected, will they be satisfied with those changes you just described? 75 percent of those Mr. Zeferetti. Excuse me. I am not advocating a change now. I am saying that people testified that they wanted everything to stay in place. If that was a condition for them leaving here, if in fact it was not in place, if they couldn't live within a different type of judicial system within the zone. Mr. O'DoNNELL. To answer that, then I would have to go back to George Meany's position, which is, if you don't protect the workers in the treaty, then we will have to oppose the treaty. Mr. Zeferetti. Is this the reaction among your members? Are they saying that we are going to leave? We will leave this place if we don't have that umbrella of protection." Mr. O'DoNNELL. Well, I can't answer that because I don't know. I don't know that answer. Mr. Zefretti. Thank you. Mr. Metcalfe. Mr. Hillis. Mr. Hillis. No questions. Mr. Metcalfe. Mr. Modglin. Mr. Modglin. One question, Mr. Chairman. Mr. O'Donnell, were you satisfied with the labor protections that were contained in the 1967 draft treaty? Mr. O'Donnell. Absolutely one hundred percent. Mr. Metcalfe. Mr. Nonnenmacher. Mr. Nonnenmacher. Mr. O'Donnell, I am a little confused by your inability to answer Congressman Zeferetti's question. Unless I misunderstood him, he is asking you whether or not your union people feel the same way as the Citizens Council presented it to us yesterday, that they could not work under a non-U. S. judicial system if the Republic of Panama took over. And you mean to say you cannot answer that question about which these people, many of whom must belong to your union, feel so vehemently? Mr. O'Donnell. I have heard people say that. It has been said in my union quite a bit and I have heard other people say, "Listen, as long as we are protected, whether we have the treaty or not is not important." I am saying I can't give you a definite answer that my union has a position either way, but I have heard it discussed to some extent on both sides. I tried to bring out a little earlier that 75 percent of those I surveyed, the most important thing to them was labor protection, not whether we had jurisdiction or not. It was labor protection. Mr. Zeferetti. In other words, you are saying the union doesn't have a position on whether or not it could live under such jurisdiction. 356 Mr. O'DoNNELL. Yes, sir. Mr. NoNNENMACHER. You then would not deny that there is this strong feeling among the people that they couldn't live Mr. O'DoNNELL. Perfectly. Anybody would be blind if they couldn't see it or hear it here in the Canal Zone. They would be deaf if they couldn't hear it. It exists. People are talking about it constantly. Mr. Zeferetti. The lack of a position of the union is 4 Mr. O'DONNELL. Yes. Mr. Zeferettl That's clear. You sat here through all of the hearing this morning and heard the general trend of questions we have posed, the answers and our commentaries in certain instances. Would you care to make any comments pertaining to any of the questions that we posed to previous witnesses? Mr. O'DoNNELL. I would like to mention one. Congressman Zeferetti presented the idea — the Panamanian Government has come out — you have been informed they have come out with the idea that the workers are against the 15 points that Governor Parfitt put out. I don't believe that is true. I believe that the employees are a little confused as to the vagueness of the 15 points, and we argue among ourselves as to what they mean, but I believe that all of the employees are very grateful for the 15 points because it is a start in the right direction, but it is not satisfactory but we are not condemning them in whole. We are trying to understand exactly what they do mean. As with any document, you have to sit down and discuss it in great detail to find out what those 15 points mean. In fact, in my union we spent most of the night trying to figure out what they did mean, but to some it was clear, to others it was not. Mr. Zeferettl Not to confuse the issue — we were told that they met with four separate unions and they discussed the assurances, and that the assurances were not in accord with what they wanted. As a matter of fact, they said that they really turned them down. But I think most of the conversation they were discussing with us was relative to, I believe, non-U.S. citizen employees, and what was said to us was that at least the bureau of information was struc- tured up — again. This is the communication that we have had, and I don't know that the testimony this morning indicates it to be true — that a bureau of information was structured up not only to talk about those assurances, but talk about ongoing treaty negotia- tions — okay — and I said at last they took care of that phase of it — shame on us that we didn't take care of our own U.S. citizens and have that network set up so we could give our people the same kind of information on negotiations which are going on, in order to speak. That is to clarify that point. Thank you. Mr. NoNNENMACHER. One last question. Would you give us your own estimate of the likelihood of continued resignations from Canal Zone Government or Company or DOD positions? Will they con- tinue as long as assurances are not discussed by the negotiators, labor problems are not discussed or employees remain unaware that they are being discussed? Mr. O'DONNELL. Well, I believe that the Panama Canal Company, as well as the DOD agencies, as far as the United States citizens are 357 concerned, they have a critical problem because we are talking about a treaty coming; we are talking about lack of jurisdiction, lack of police, courts, etcetera. There is a tremendous amount of employees who are deciding that maybe it is time to leave this area and the publicity, the psychological effect upon the employees is very strong and they believe that the United States Government is not at this time interested in protecting them. They feel they had better take care of themselves because the congress or the Government or the State Department is not, and I believe personally that the Governor is in one hell of a position. He is trying to say to the employees, "Stay here. We want to protect you, but I can't tell you about it because it is secret. You know, because negotiations are secret and we won't be able to bring all this information out until it becomes public knowledge." In the meantime, the wife and husband say, "I can't wait that long." So starting here maybe a year ago, more people are starting to look elsewhere. The unions are asking — they start with the Board of Directors. I asked the Board of Directors of the Panama Canal Company to allow us to transfer back to the United States - help us transfer back, let us get on the DOD referral system. This would help us to leave here early, quicker. I believe it is happening. It is something that is developing right now and if we hold off a treaty for five or six more years, I believe we will be able to see eventually the U.S. citizens reduced from maybe 4,000 employees down to 1,000. They are leaving here because they do not feel secure. Mr. Metcalfe. I think it ought to be pointed out that you have indicated in your discussions with members of your union as to what precisely the 15 assurances were. I interpreted it as meaning that the Governor was candid with you and wanted to allay your fears, but I also was of the opinion the Governor did not have any additional information that came to his attention that he could put in those assurances. The fact that the intent was there, I think, is in and of itself very significant and I think the Governor has to be applauded for being sensitive to this apprehension that exists not only in the Zone, but in Panama and with all of the groups involved. Mr. O'DoNNELL. I would like to amplify that by saying that I believe the Governor has been extremely fair, fair-minded and he is open-minded, but he has a problem. He has superiors. Mr. Metcalfe. Lack of information. Mr. O'DoNNELL. He just can't tell us everything he knows and there are some things he doesn't know. Mr. Metcalfe. I am disagreeing with you respectfully, Mr. O'Donnell. I am of the opinion the Governor is giving you all the information he does have. I am saying he doesn't withhold any information, that he just didn't have it available to him. Mr. O'Donnell. Congressman, I am going to get in deep water here, but I am going to say this: Governor Parker told me once in his office — let me repeat that again. Governor Parfitt — Governor Parker, not Parfitt, Parker — told me in his office: 'They have that much information,*' and he held up his hand for about two inches — "of labor protections and what 358 we think should be given to the employees, but we can't release it. We don't have any authority to do that." Mr. Metcalfe. They can't produce it because there is no agree- ment. Isn't that what Governor Parker Mr. O'DoNNELL. The Governor had worked up material pertain- ing to our labor protection, but this is what they believed should be done. Mr. Metcalfe. I believe what should be done is the key point where there may be some differences in our analysis of it. Thank you for yielding. Mr. NoNNENMACHER. What Governor Parker told you may well be what the company would like to do. But would the State Department insist on all that with Panama's negotiators? You then would support to the fullest the testimony which the Governor gave us yesterday concerning this problem of resignations? While it may not be critical at the moment, is it not definitely capable of becoming a crescendo of resignations, as time goes on and uncertainty remains? Mr. O'DoNNELL. It is happening right now and it is obvious this development is getting greater and I believe it is going to be even greater. Mr. Tannenbaum. One quick question, do you care to comment on the tri-level wage disparities for comparable positions as among the U.S. citizens-employees, the Panamanian employees, and the Panamanian citizens employed outside the Zone? Mr. O'DoNNELL. That is a big question. You know I guess the best way to answer that would be to say ,*'No, I don't care to answer that one because it is going to take an hour to tell you that answer. It will talk about the tax factor and the way we do things. It will talk about how we are structured but generally I would say this, that we are in favor of equality. We would like everybody to be treated equally. Mr. Tannenbaum. Specifically I am talking about the differen- tial. If you took a teacher at a starting salary in each of the three categories, what would be the difference? Mr. O'DoNNELL. A teacher in the Canal Zone? Mr. Tannenbaum. A U.S. employee teaching in the Canal Zone, a Panamanian citizen teaching outside Mr. O'DONNELL. Since Dave is a teacher, he would be glad to tell you that answer. Mr. Baglien. Well, the only difference between the U.S. citizen and the Panamanian citizen teaching in the Canal Zone is a differential of 15 percent, whatever the salary is. The difference between either one of those and Panamanian teachers, and I've talked to a few who worked in College, vary from three hundred fifty a month to five hundred dollars. In a university possibly some a thousand, but there just is no comparison. Both the Panamanian teacher and U.S. teacher in the Canal Zone is making, I would say, two to three times as much as the typical Panamanian teacher. Mr. Tannenbaum. Would you know that to be similar for policemen? 359 Mr. Baglien. I don't know about any of the other things, but it seems logical. The same maids that work in the Canal Zone at minimum wage work in Panama for sixty cents an hour, something like that. Mr. Tannenbaum. Sixty cents an hour against what? Mr. Baglien. $2.20. Mr. Tannenbaum. And how about the benefits which were brought out earlier? Would the Zone employees have benefits com- parable to Mr. Baglien. Well, the Panamanian teachers, for example, have a really good retirement system. They retire unusually early. I don't know exactly how they manage to keep the fund from going broke, but they do have that in their favor more so than U.S. teachers, but otherwise, I suspect they are comparable. Mr. Metcalfe. Mr. Baglien, I would like to ask just one question. This differential between the Latin American teachers and the U.S. teachers that you alluded to, is that based upon qualification? Because we know in the American system all professors don't get the same salaries and all that. Or is it based upon their nationality? Mr. Baglien. It is based on nationality. It is based on the fact that the American teachers are — Mr. Metcalfe. I'm not talking about the differential. I am talking about the base pay, not including the 15 percent. Mr. Baglien. It is identical, position for position. In other words, an instructor with five years' service — that is the Panamanian as compared with an instructor with five years' service who is a U.S. citizen will receive the same pay except for the — Mr. Metcalfe. There is no discrimination. I want to make that clear. It is only in the differential. Mr. Baglien. That is right. Mr. Metcalfe. Thank you very much, gentlemen, for coming and testifying before us. [Mr. O'Donnell submitted the following information for the record:] 360 American Federation of Government Employees Local ^k>. 14 P.O. Box 1703 Balboa, Cemal Zone April 13, 1977 Mr. Ralph H. Metcalfe Chairwan Panama Canal Coopany Subcommittee Room 322 Canncm House Office Building Waahingt:on, D.C. 20515 Dear Mr. Metcalfe: Educational personnel in the District of Columbia are authorized under the provisions of PL 624 of August 7, 1946, to buy credit in the D.C. retire me nt system for prior educational service to a maximum of ten years. This same procedure is also already available to educators in most of the 50 states, and is recommended by the Council of Chief State School Officers for adoption by all remaining states. ^ Most educational personnel arrive in the Canal Zone with several- years prior service, aund typically do not have at time of retirement ' nearly as much service 'as other Peuiauna Canal personnel. In view of the • uncertainties now facing the Paiiama Canal future, I ask that educational personnel here be authorized to purchase credit toward retirement for prior service on the saae basis as do educational personnel in the ' District of Coluebla. An aasAdtee&t to any appropriate piece of legislation might read: "Educational personnel in the Canal Zone are authorized to purchase credit for prior educational service toward U.S. Civil Service Retireaient on the same basis and under the same condi- tions as was authorized for educational personnel in the District of CoXxinbia by PL 624 of August 7, 1946." I would like you or your coiwnittee to introduce a bill or an aMSSfdment such as the above suggestion so that Czmal Zone educators Might receive the sane retirement benefits as their cowpatriots in the District of Columbia. Thjunk you for your time and your support. Very sincerely yours, James J. O'Donnell President 361 STATEMENT OF MR. J. R. WILLIAMS, PRESIDENT, PANAMA CANAL PILOTS ASSOCIATION, ACCOMPANIED BY CAPTAIN JOE MORRISSEY, VICE PRESIDENT, AND CAPTAIN R. D. VALENTINE, VICE PRESIDENT Mr. Metcalfe. The next group and perhaps the final group will be the Panama Canal Pilots Association, A.F. of L., headed by Mr. J. R. Williams, who is the president of the organization. Mr. Williams. First of all, I would like to introduce two principal officers of our association, the vice president, Captain Joe Morrissey and second vice president. Captain R. D. Valentine, whom you know from previous tenure as president the year before last. Two days ago, I furnished your subcommittee, through the offices of the Governor, a treaty position paper which I assume everyone has been given copies of If you like, I can read that position paper. Mr. Metcalfe. Can you summarize it, and submit it for the record? Mr. Williams. Certainly. BACKGROUND: In 1973, the Canal Zone Code was modified to permit the hiring of qualified Panamanians as pilots. Well-qualified Panamanians were subsequently hired as Pilots-in-Training and their development as pilots has proven their professional capability to everyone's satisfaction. Panama is clearly obligated to encourage her young men to embrace sea-going careers if they are to become full partners in the Canal Enterprise, as indeed they must. The Panama Nautical School is a step in the right direction. Its graduates can go to sea, and as their experience grows, become command-qualified in a very few years and be eligible to become Panama Canal Pilots-in-Training. The development of qualified Panamanians for future pilots along these lines, we endorse, and are committed to assist wherever possible. THE PROBLEM: Meanwhile, we must concern ourselves with an orderly and harmonious transition period of key employees, which, in our case, means pilots, a group that is recognized as both the least dispensable and the most difficult to replace. An exodus of pilots could cripple the Canal operation. This can and indeed must be avoided by encouraging presently employed pilots to remain. There are several factors to consider. First, pilots were recruited to come here, by necessity, on a career basis, as contrasted to DOD personnel throughout the world, who are generally on a 5-year rotational stint. Also, there are few, if any, comparable piloting jobs elsewhere in the Federal service for pilots to be transferred. We are not, for all practical purposes, transferrable, as are other crafts and professions. Therefore, a much greater necessity for consideration exists than was demonstrated in, for example, the transition effected in Oki- nawa. There is no comparison. Panama Canal pilots of varying experience are being recruited in increasing numbers to return to the U.S. for employment as shipmasters and pilots for salaries in excess of $60,000 per year. 362 Pilot salaries in the U.S., the amounts of which are secretively guarded, range far in excess of this figure. The Canal Enterprise must therefore meaningfully compete with this growing reality. THE SOLUTION: In order to seriously address this problem of pilot retention, now, and particularly in the post-treaty era, the following minimal measures are proposed. 1) Optional, open-ended early Federal retirement for any Panama Canal pilot with 15 years accredited government service, with one year additional credit for each 5 years of service. This means full retirement, with no reduction of annuity because of age. [Due to the deleterious physical and emotional stresses, characteristic of pilot- ing here, the useful period of service historically hovers at about 13 years. Further, since most pilots are hired in their forties, they will have reached a normal retirement age when eligible under this provision.] 2) A pilot who elected to retire may be rehired by the new agency that operated the Panama Canal, with no loss of retirement annunity. This would imply no obligation to hire him on the part of the new agency and he could acquire tenure only from the date of his rehiring. 3) Raising pilot compensation to "Maritime Industry Standard,"as recognized in the United States, plus appropriate cost-of-living dif- ferential. Industry standard, as applied to pilots, is, and has tradi- tionally been, shipmaster's pay of the largest vessels. 4) Implementation of an optional, alternative work schedule that would permit pilots to maintain their primary residence in the U.S. and commute 5 to 6 times per year to Panama to perform their share of the workload. Such a system compares with several pilot- ing arrangements in the U.S. and elsewhere, and is presently under consideration by the Panama Canal Company. 5) Implementation of a collective bargaining process and a long- term contractual arrangement that would guarantee, in an atmo- sphere of mutual trust and harmony, the attainment and retention of the aforementioned goals that are necessary to preserve the vital piloting skills that the Canal will require. SUPPORTING RATIONALE: Assuming that one of the objectives of a new Canal treaty is to insure an orderly and amicable transi- tion from what is essentially a U.S. citizen pilot force to one that gives hiring preference to Panamanians, we consider the adoption of these proposed measures to be essential for the successful evolu- tion of a harmonious and cooperative employee transition period. Failure to do so in what is essentially an environment of transition and drastic change, would undoubtedly result in enormous and bitter resentment followed by profligate resignation by pilots. This era, by necessity, will require several years in order to conclude the goals set forth in the treaty provisions. Therefore, the rationale for arriving at the foregoing proposals was based upon dividing the pilot force into the following three broad categories: 1. Those with enough, or nearly enough service to retire. 2. Those with less than five years' service. 3. A middle group with more than five years but still a large amount of time before becoming eligible to retire. 363 For those in group number one it is felt that although they would have a retirement earned, it is probable that their age and their financial status would make it attractive that they continue work- ing here rather than going back to sea or piloting elsewhere provided that an alternate work plan was available as an option and the pay was up to industry standards. For those with less than five years' service it is believed that the combination of the optional work plan at a competitive pay scale, and the incentive of early retirement will compete favorably with the alternative of resigning and going back to sea, or piloting elsewhere. For those in group three it is assumed that the incentive of a reasonably early retirement being attainable, combined with the addition of the optional work plan at a competitive salary will cause the majority to continue their employment. RELATED OBSERVATION: Panama has stated that they have no objections to the inclusion of labor protections in a new treaty. Indeed, the 1967 treaty draft conceptualized much of what we are proposing. We therefore believe that the U.S. Government may unilaterally adopt these measures, outside the treaty negotiating context, that will assure the efficient continuity of operations of the Panama Canal during an employee transition period that should and could be conducted in a dignified and cooperative atmosphere. Mr. Chairman, in summary, my statement above discusses the background of hiring Panamanians as pilots, which is one of the provisions of the treaty as it has been explained to us and as is contained in the 15 assurances, that Panamanian citizens will be increasingly involved in the operation and employment of the waterway. It addresses the problem of retaining pilots now and in the post-treaty era on the basis of the fact treaty uncertainties notwithstanding, pilots are leaving their employment here in greater and greater numbers due to better opportunities elsewhere in the marine industry. It makes some specific proposals for the post-treaty era, none of which conflict with any other AFL-CIO provisions. In fact, some of them are merely identical adoptions of those AFL-CIO provisions. And towards the end of the position paper it stresses the ratio- nale for the necessity of this. In fact, the whole paper is focused on the problem of keeping enough pilots here now and even more particularly in a post-treaty era, and in an employee transition period as related to pilots which must take several years. As far as treaty information is concerned, I attended the Gover- nor's meeting when the 15 assurances were distributed to us, and he described them as he understood the meaning of them to be. So in my mind, at least, some things are already very clear insofar as this treaty is concerned. One of them is jurisdiction. It will change from the United States to Panama. That's very clear to everyone who attended there and listened. It is also very clear that there is an eventual intention that Panamanians will occupy all the positions, or a growing number of positions, in the operation and the management of the Canal. Whether these provisions were contained in some memorandum of 364 understanding that has been pubUcized or in the Tack-Kissinger agreement, I don't know. But our position paper is based on our perception of what this coming reality is, whether we like it or don't like it. We cannot tell the President of the United States he cannot conduct the treaty negotiations. He will do that whether we want him to or not. We feel we have a right to insist upon our interests being taken care of under such a treaty. But he conducts the treaty negotiations, himself, and makes the negotiations, and a set of foreign policy objectives that goes far beyond our immediate concedrn. It is something we have steered clear of or in commenting upon. That is about it, Representative Metcalfe. Our solutions to var- ious provisions are very specific, very clear, and very easy to understand. I encourage you and your committee members and staff to read them and reflect upon them and hopefully when the time is appropriate, as you have mentioned earlier, to act upon them. Mr. Metcalfe. Thank you very much, Mr. Williams. I am now going to ask unanimous consent that we be privileged to submit to you any additional questions that may not be asked of you at this particular time, and ask for any future comments. This applies to all the rest of the witnesses who have appeared before us. They will have the same privilege of doing the same thing, of submitting comments for the record. Without objection, it is so ordered. [Mr. Williams submitted the following correspondence for the record:] 365 Reply lo: InlwnaHonal Organliullon Maflan, MatM A Plloli, Inc. AfAllofad wllti AFL-CIO Inlccnatlonal Maritlm* Pilot Aaoclotlon Manama Canal pilots; ^s;0ociatton J . R. Wil l iams KX P O. Bo« 601 Balboa, Canal Zon* □ Droww 5005 Criftobal, C.Z. CabI* Addran: April 11, 1977 Copiain J. Farmer Representative Ralph H. Metcalfe U. S. House of Representatives Room 1334 Longworth House Office Building Washington, D. C. 20515 Dear Representative Metcalfe: The imminent likelihood of a new treaty governing the future of the Panama Canal is, and has been for several months, the para- mount concern of most Panama Canal Pilots and their families. The "Fifteen Assurances" notwithstanding, we are completely di smayed. .and baf f 1 ed . . that comprehensive employee provisions are not under immediate consideration by the Dept. of the Army, the Treaty negotiators and the U. S. Congress. Pilots are resigning at an unusually high rate; and, unless meaningful steps are taken soon, these resignations are likely to reach epidemic proportions, with a disastrous lowering of over- all Canal operating efficiency. • Further, pilots are, in all cases, resigning to accept better employment elsewhere, at locations In the Maritime Industry where pay and related benefits have outstrl pped *what they received here. We therefore urge your endorsement of the measures provided in our enclosed position paper that addresses the problems of re- taining pilots in a post-Treaty era. Your support for whatever legislation is required we would look upon as essential for bringing these very necessary goals into fruition. Sincerely yours. JRH/cf Enclosure cc Gov. Parfitt AFL/CIO 366 Reply lO: Inlamallonal Organliollon Maitan, ' MalM A Pilob, Inc. Alfillal» — Mainpooteria (F) Fra« 376 6048- Back INFORMATION SHEET FOR QUARTERS WEEKLY VACANCY BUUETINS The apartments listed on the weekly vacancy bulletin will be aasigned to the senior applicant on file with the Housing Manager on time and date indicated in accordance with the Housing CoiMolidation Implementation Procedure and Chapter 737 of the Panama Canal Peisonnel Manual. SPEQAL NOTICE I. Applications from employees i.-ho do not presently have a Company quarters assignment must be certified by the Chief, Personnel Operations Division, that the applicant meets general quartee alignment eligibility requiiemerti. n. Mobile home sites located in Curundu and Coco Solo, Canal Zone, ape immediately available to applicants possessing quarters eligibility. Written application should be submitted to the Chief, Community Service* Division. III. An employee will be ineligible for quarteis on the next two vacancy bulletins after date of declining an assignment. IV. A four vacancy bulletin penalty effective the date of declination will be imposed on employees who cancel after having accepted a quarters assignment. FOOTNOTE USTINC L Large family preference under established diminishing family size for designated quarters. AU interested applicaKs should apply. 2. Available to bachelor or family applicants - service date is determining factor. 3. Assigned par4dng space. 4. As a condition to this assignment, you will not be permitted to construct a boat shelter. 5. Garages under building are available on a fim-come, fiist-serve basis (Building 236, Ancon). 6. Includes electric current, but an additional charge of $0. 80 biweekly wiU be made if electric dryer is installed in the apartment (Building 224, Ancon). 7. Due to plumbing li mitations, installation of automatic washers in the apartmeids are not authorized (Bldff. 224 & 236, Ancon). 8. Parking of boats within t)ediente del Gerente de Vivienda, coniorme al Proce la ConsolidaciOn de Viviendas y el Capftulo 737 del Manual de Peisonal del Canal de Panaml, AVISO ESPEQAL I. Las solicitudes de los empleadoe que no tengan vivienda adjudicada en la actualidad, deberSn contener una ceitifica- cidn del Jefe de la Division de Operaciones de Personal donde conste que el solicitante llena todos los requisitos generales de elegibilidad paia la asignaddn de vivienda. II. Los sitios para la instalaciOn de casas mdviles en Curundtl y Coco Solo, Zona del Canal, estin disponibles de inmediato para aquellos solicitantes que poseen elegibiUdad para obtener vivienda. Las solicitudes escritas deberin ser enviadas al Jefe de la Division de Servicios Comunales, m. En caso de rechazar el solicitante la vivienda que se le ha asignado, do tendrl detecho a solicitar viviendas de los dos anuncios subsiguientes. IV. Aquellos soUcitantes que, luego de aceptar una asignacidn de vivienda, la cancelen, tio tendrln detecho a solicitar vivienda de los cuatro anuncios subsiguientes a la fecha de declinacion. NOT AS L Se le dar4 preferencia a familias grandes segtln su tamano y en orden decreciente conforme a su designacidn. Todos los soUcitantes intetesadcs deber&n presentar su solicitud. 2. Disponible para solicitantes solteros o con familia. La fecha original de empleo es el factor determinante. 3. Estadonamiento asignado. 4. Como condiciOn para esta asignacifin, no se permitira la construcci(3n de casetas para botes. 5. Los garajes en la parte inferior del ecificio serin ocupados en orden de llegada (Edificio 236, AncOn). 6. Induye electricidad, con un cargo adicional de $0. 80 cada dos semanas en caso de instalacifin de una secadora elfictiica en el apaitaxnento (Ecfifido 224, Ancoii). 7. Debido a las limitadones de la plomexfa, no se atitoiizard la instalaciOn de lavadoras automlticas en los apartamentos (Edifidos 224 y 236, AnaSn). 8. Se prohibe estadonar botes dentro del area de los apartamentos del Gorgas. 9. Este apaitamento ser4 rehabilitado prtfximamente segtin la disponibilidad de fondos. Los empleados que acepten esta asignaciOn deberln trasladaise a otra vivienda raientras se effecttian los trabajos. 10. Disponible para asignaciOn provisional; comunfquese con el Gerente de Vivienda para mayores detalles. 11. Instaladones comunes para empleadas. 12. Cuaito de dep<56ito. 379 Workers ' Buying Power In Major Cities of Wcrld Purchasing power in major world cities, expressed in terms of number of hours a person must work to buy a market basket of typical goods and services, is reflected in the follow- ing table. The source is the Geneva-based banking chain. Union de Banques Suisses. Hours City Wo 1 Iced City Worked San pM'ancisco OJ-j/ '* Caracas 132 Chicago / Z- 1 / J - Milan i 37-2/5 Los Angeles 73-3/4 Dublin 137-3/5 New York ' 76-3/4 Sao Paolo 145-1/3 Toronto 82-4/5 Paris 149 Montreal 85-1/2 Madrid 158 Geneva 89-3/4 Tokyo 162 Amsterdam 91-1/5 ■ Rio de Janeiro 185 Zurich 91-3/4 PanamaXily A91 Sydney 93-1/5 ^Mexico City 202- r/3 Copenhagen 93-3/4 Athens 207-1/2 Luxemburg 95-4/5 Teheran 208-3/4 • Dusseldorf 99-3/5 Hong Kong 217-3/5 Stockholm 103-3/5 Istanbul 239 Oslo 113-3/4 Singapore 264-3/4 Brussels 114-1/2 Tel Aviv 267-3/4 Helsinki 115-4/5 Lisbon (^Bogota 271 Vienna 118 288 London 124-1/4 (g) Manila 356-4/5 Johannesburg 126-1/2 ^ Buenos Aires O 482-1/4 380 • I. HUPPC. MICH. J^ouit of a^eprcjfentatibei Committee on |Hertf)ant iHarine anb Jf iafjeriei Room 1334, longtDortt ^t&tt JiDilliing JHairtjington. B.C. 20515 May 24, 1977 Mr. James J. O'Donnell American Federation of Government Employees Local No. 14 Box 1703 Balboa, CANAL ZONE Dear Mr. O'Donnell: This is in reply to your correspondence, dated April 30, 1977, responding to Governor Parfitt's state- ment concerning discrimination complaints on the basis of national origin. Your correspondence, and the Supreme Court opinion attached thereto, will be made a part of the record of the Subcommittee's Canal Zone hearings. The Governor's statement, made at the opening session of hearings is, of course, already included in the hearings. Additionally, the Subcommittee will ask for and study a copy of the Civil Service Commission statement on the question of national origin and discrimination, and we will ask the Commission for a definitive and clear opinion on this matter if the present opinion is inadequate. Copies of these will be forwarded, if possible. This question of national origin and discrimination is an important matter. The Subcommittee is. indebted to you for the vigorous expression of your interpretation of the matter. Please continue to communicate with us on this and other matters. Sincerely , Chairman Panama Canal Subcommittee 381 . „ LOCALNo.14 c^MERICAN ^DERATION OF g^OVERNMENT tMPLOYEES AMIIolwi w»rt» iti* AFL-aO— TK» Granddoddy o< Conol Zon» LocaU ^^^^ Strv'mg Ftderal Employtts at tht Crossroads of tht World Boi 1703 aMirt^O«tob«9.193« April 30, 1977 Bolboo. Ca»al Zo«. The Honorable Ralph H. Metcalfe Chairman, U. S, House Subcommittee on Panama Canal Affairs ^ 5 j^/ House of Representatives Washington, D.C. 20515 Dear Mr. Chairman: The enclosed newspaper clipping from the Star & Herald issue of April 14, 1977, is self-explanatory and serves as the basis for this letter. Inasmuch as Governor Parfitt submitted the statements in the newspaper article as part of the official con- gressional hearing record, I respectfully request that my state- ments in this letter, together with attachments, also be made part of the official hearing record. With regard to the statement in the article that "The General Counsel of the Civil Service Committee has recently ruled that non-U. S. citizens employed in the Canal Zone are within the scope of persons protected by the (U.S.) equal opportunity laws," I wish to state categorically that Title VII of the Civil Rights Act of 1964 specifically excludes the extension of this protection to non-citizens outside of the United States. "Title VII of the Civil Rights Act of 1964 protects all individuals, both citizens and non-citizens, domiciled in the United States, against discrimin- ation on the basis of race, color, religion, sex, or national origin." 29 CFR 1606.1(c) (1972) (Underscoring supplied.) Also, in the case of Espinosa vs. Farah Manufacturing Company, 95 S. Ct. 334 (1973) (copy attached) the Supreme Court referred to Tit. VII wherein it states that Tit. VII "shall not apply to an employer with respect to the emplo3nBsnt of aliens outside any State..." 42 U.S.C. 200e-l . In this same case the Supreme Court stated, "Title VII was clearly intended to apply with respect to the emplojnnent of aliens inside any State ." (Under- scoring supplied.) As a longtime labor leader I strongly believe that when social or monetary gains are made by any group of workers these gains should never have to be given up or otherwise lost. Therefore, I do not intend to dispute the inclusion of non-U. S. citizen employees in the Canal Zone under the U. S, equal opportunity laws. However, in view of the fact that an additional basis for discrimination now exists in the Canal Zone that does not exist We do in unitj^ that which ij impoJjihU in dijunitt^ 382 The Honorable Ralph H. Metcalfe April 30, 1977 Page 2 in the United States, 1 hereby respectfully request that you seek to have EEO law and/or regulations amended as follows: (1) to show that non-U. S. citizen employees in the Canal Zone are properly covered by the law (if, in fact, they are) and (2) in terms of the Canal Zone only , to approve another valid basis on which a complaint of discrimination might be submitted, namely, discrimination on the basis of citizenship. With reference to the statement in the aurticle, "To compli- cate matters, there is considerable confusion among employees and others concerning the applicability of the Civil Rights Act to complaints of discrimination on the basis of citizenship," 1 respectfully suggest that the confusion referred to indeed exists — but not among the employees. Rather, it exists in the mind of this agency's General Counsel who, incidentally, is the author of the Governor's statements in the attached newspaper clipping. You will note that the author of the Governor's statements slipped in his own definition of national origin when he states, "As you know, the Civil Rights Act prohibits discrimination on the basis of national origin meaning ancestry or ethnic heritage . . ." From this we can infer that because the Panama Canal Company General Counsel states that's what it means, then, of course, that is obviously what it must mean'. Right? VRONG '. *. '. In the aforementioned case of Espinosa vs. Farah Mfg. Co. (page 88, attached copy) the Supreme Court provides a specific, crystal clear definition of national origin, i.e., "The term 'national origin' on its face refers to the country where a person was born , or, more broadly , the country from which his or her ancestors came" (underscoring supplied). Under this definition it is perfectly clear, therefore, that if a person was born in the United States, and his ancestors hailed from another country, that person would be perfectly correct in claiming his national origin to be U.S. or American. This point is particularly critical here in the Canal Zone because the entire thrust of the Panama Canal Company General Counsel's argument is that an American federal employee in the Canal Zone cannot charge discrimination based on national origin in any Job related action where such discrimination might, in fact, have taken place in favor of a Panamanian employee — or vice versa. In spite of the fact that the Supreme Court definition is perfectly clear to any intelligent person, and would certainly take precedence over any other definition (including, incidentally, the Panama Canal Company General Counsel's) this agency's General Counsel insists that vis-i-vis U.S. and Panamanian employees discrimination based on citizenship might indeed be possible, but not discrimination based on national origin. 383 The Honorable Ralph H. Metcalfe April 30, 1977 Page 3 As a result of this illegal and ludicrous stand, legitimate Equal Employment Opportunity complaints of discrimination based on national origin submitted by both U.S. and Panamanian employees have been refused, shelved, denied, or otherwise prevented from being accepted or heard under the EEO laws and regulations. In fact, there are cases which have made it as far as the Civil Service Commission's Appeals Review Board, with the Board confirm- ing the legitimacy of the employees' EEO complaints of discrim- ination and ordering the agency to accept and proceed with the case, and still the agency has refused to accept and proceed with the case as instructed ! I Mr. Chairman, this incredible state of affairs cannot be per- mitted to continue. This agency's General Counsel has made a mockery and a shambles of the EEO laws and regulations with a resultant screaming nosedive in the credibility with which the agency's EEO program is viewed by the workforce. I can assure you, Mr. Chairman, that with the uncertainty that prevails in the Cemal Zone today, the already low morale of the employees needs no additional dents made in it by the wholly stubboim, illogical, and obfuscatory stance taken on this EEO question by this agency's General Counsel, notwi ths tand ing the Supreme Court's clear definition of what constitutes "national origin." See page 88, case of Espinoza vs. Farah, wherein the Minnesota State Act Against Discrimination, Minn. Stat. 363.01, subd. 6 (1971) defines "national origin" as "the place of birth of an individual or any of his lineal ancestors." (Underscoring sup- plied.) See page 89, case of Espinoza vs. Farah, wherein Congressman Roosevelt, Chairman of a House Subcommittee, defined "national origin" as, "It means the country from which you or your ancestors came ." (Underscoring supplied. ) See page 94, case of Espinoza vs. Farah, wherein the Equal Emplojnnent Opportunity Commission, through its General Counsel, said: "'National origin' refers to the country from whtch the individual or his forbears came . . . " (Underscoring supplied. ) Mr. Chairman, the one thing Which is readily seen in all of these definitions is that they define "national origin" primarily and specifically as "based upon the country where a person was bom," with a secondary and infinitely broader meaning to the additional statement, "or from where his ancestors came." Mr. Chairman, I beg your indulgence for the length of this letter, but anything less detailed would not have been sufficient to make my point. We seek your help to clear up once and for 384 The Honorable Ralph H. Metcalfe April 30, 1977 Page 4 all the EEO morass into which this agency has forced us. We need someone to tell this agency's General Counsel to cease and desist in his attempt to deprive employees of their hard-won rights under the law. We also need someone to have the Civil Service Commission carefully check the validity of the position 1 have outlined in this letter and forthwith to inform the agency and the agency's employees . We seek your help. Enclosures cc: Mr. Robert Bates, Assistant to the Commissioner (Appeals) Chairman, Appeals Review Board President, A.F.G.E. National Director Office of Federal EEO Sincerely, Cames J. O'Donnell President, Local No, 14 American Federation of Govexmroent Employees 385 Sfi ' CCIOBEK T£1::M, 1973 Syllabus 414 U.S. ESPINOZA ET VIP V, FARAIi MANUFACTURING CO., INC. CERTIORAIU -i'O THt- UNITED oTATCi, COUrvT Or APPIOAI.S i-OK TH.e FIFTH CIRCUIT No. 72-G71. Ariiued October lOy.^-- Decidwi November 19, 1973 IVitioners, Mr. and Mr.s. Espinoza. l)rouri.t sviir after ovl'.cmj^t- ing their administrutivo remedies wjih tl'.e Kqapl Eii>)">lnymcnt Opportunity Cormuisiiion (JCEOC), tliMl rr.spoi^dcnt.'i^ le- lusal to hire Mr?. Kspiiioza in its Suvi' Aiiionio divi?io;i because of iier iviexl.car. citizenship viclaf.ed § 7(»3 ot Title VII of tlio Civil Rights Act of 3964. which makes i.i an uniiivrful emplo-'ment prac- tice for an employer to fail or refu.3e to hire auy iuclividual o^jcuiise of his race, color, rehgioa, sex, or iv^iioiAal origin. Tho Disirict Ck)urt granted pctitionere' motion for suiauuiry judgnic.it, relyhig primariiy on an EEOC gPcidehne prcviding that a lawful alioi* resident may not be dLscrimiuated again.^t on ihe basis of citizt'u- ship. The Court of Appeals reversed. Held: An employe.^'s refusal to hire a person because he i? not a Uibtcd States citizen does not constitute employment discrip^ination on the ba.si3 of "national origin" in violation of § 703. Pp. Slv-So. I a) In light of the statute's iegislafive history and the lo.ng- standing j^/iaciice of requiring federal eraployees to be United States citizens, it is clear that Coiigroso did not intend the term "national origin" to embrace citizenship requiicme.nts. Pp. 88-01. (b) The KEOC's guidsliuo, though pcirhaps significant in «i wide range of other situations, does nut r-.pply here or support the premise that discrimination on the bash of citizenship is tanta- mount to discrira 'nation on the basis of national origm, sLrico there is no showing ihat respondent (93% of whose Son >\ntonio division eniplo3'ce.s are Mexjoan-Ai:.'iericani;) discriminated against persons of Mexican origin Pp. 92-95. (c) llinu:;h the Act protects aliens ngainst illegal discrinutic- tion bccav.se of race, color, religion, sex, or national origin, it does not proscribe discrimination on the basis of alienage. P. Go. 462F.2d?331, nffimaed. \ Marshall, J., delivered the opinion of ihe Court, in Vr'liich 95-549 O - 77 - 26 386 ESPINOZX V. FAJ^AH XIKG. CO. 87 80 Opinion of the Court BuRGEJi. C. J., .md Brennax, Stewart, White, Bl.^ckmuk, Powell, and Rehkquist, J J., joiiicd. Douolas, J., filed a dissenting opirion, poU, p. 96. George Cooper argued the cause for petitioners. With him on the briefs was Ruben Montemayor. Kcn-ticth R, Carr argued the cause for respondent. With him on the brief were Jack T. Chapman and William Duncan,* Mr. Justice Marshall delivered the opinion of the Court. This C2.se involves interpretation of the phrase "na- tional origin" in Tit. VII of the Civil Riglits Act of 1964. Petitioner Cecilia Espinoza is a lawfully admitted resident alien who was borji in and remains a citizen of Mexico. She resides in San Antonio, Texas, with her husband, Rudolf o Espinoza, a United States citizen. In July 1969, Mrs. Espinoza sought emplo}*ment as a seam- stress at the San Antonio division of respondent Farah ]VIanufacturing Co. Her emplo>'ment apphcation was rejected on the basis of a longstanding company policy against the employment of aliens. After exhausting their administrative remedies with the Equal Employ- ment Opportunity Commission,^ petitioners commenced this suit in the District Court alleging that respondent had discriminated against Mrs. Espinoza because of her "na- tioi/al origin" in violation of § 703 of Tit. VII, 78 Stat. 255, 42 U. S. C. §20006-2 (a)(1). The District Court granted petitioners' motion for summary judgment, hold- *Bnefs of amid curiae urjpng reversal were filed by Joseph T. Eddim, Jr., and Beatrice Rosenberg for the Equal Empio^mcnt Opportunity Commif5Eion; by Mario G. Obledo and San ford Jay Rosen for the l\Iexican American Legal Defense and Educational Fund; snd by Kenneth Hecht for the Employment Law Center. » Section 706 (c), 42 U. S. C. § 200C>e-5 (e). 387 88 OCTOPER TEIUi, 1073 C-L- c: ..ic Cocrt 414 U. a hug that a refusal to hire because of lack of . constitutes discrimination on the basis of ''i origiii.' 343 F. Supp. 1205. The Court of . reversed, concluding that the statutory p - ongi ri" did not embrace citizenship. 462 x _ granted the v^tiI to resolve this question of su: - struction. 411 U. 5 c^4 " alBrm. Section Tl'i r : employuient prac- tice . : :5e to hire . . . £. : ; . S.3 c: - ilvidaal^s race, color, religion, sex, or rigin." Certjonhr the p' :^:' - I r - -e of th : : the result readied by i:.e C:urt of A; . • "-^--r^T on it5 face refers :: . . - ••■v.e. e a. ::;s::; •••is orr. history, thou^ qaiie elc^ct tory p:2 £i ;C . . . r ■ ■ : ^ - : _ Tlie New Y::-: S i ^ . that an empioyer " .isk a job appiKJ she 15 a dtiif- _ ? : :5 Sec 3 CCH Prac Guide T - White th - eoBstmctic - ^ of a gec-er?^ wndMstanc r : .4 ihjbiiig a 388 ESPINOZA V. FARAH HIFG. CO. 89 86 Opinion of the Court ill this respect, fully supports this construction. The OJily direct definition given the phrase "national origin*' is the following remark made on the floor of the House of Representatives by Con p| ressman Roosevelt^ Chair- man of the Ilou^n Siihrommittp^ which renorted the jjill: "It means the country/ from which vou or vour f orebears came You may come from Poland, Czechoslovakia, England, France, or any other country." 110 Cong. Rec. 2549 (1964). We also note that an earlier version of § 703 had referred to discrimination because of "raccj color, religion, national origin, or cwi- cestnj." H; R. 7152, 88th Cong., 1st Sess., § 804, Oct. 2, 1963 (Comm. print) (emphasis added). The deletion of the word "ancestry" from the final version was not intended as a material change, see H. R. Rep. No. 914, 88th Cong., 1st Sess., 87 (1963), suggesting that the terms "national origin" and "ancestry" were considered synonymous. There are other compelling reasons to believe that Congress ,did not. intend the term "national origin" to embrace citizenship requirements. Since 1914, the Fed- eral Goverjiment itself, through Civil Service Commis- sion regulations, has engaged in what amounts to dis- crimination against aliens by denying them the right to enter competitive examination for federal employment. Exec. Order No. 1997, H. R. Doc. No. 1258, 63d Cong., 3d Sess., 118 (1914); see 5 U. S. C. §3301; 5 CFR § 338.101 (1972). But it has never been suggested that the citizenship requirement for federal employment constitutes discrimination because of national origin, even tiiough since 1943, various Executive Orders have expressly prohibited discrimination on the basis of national origin in Federal Government employment. See, e. g., Exec. Order No. 9346, 3 CFR.12S0 (Cum. Supp. 1938-1943); Exec. Order No. 11478, 3 -CFR 446 (1970). 389 90 OCTOBER Ti^llAI, 1073 Opinion of tlic Court 414 U.S. Moreover, S 701 (b) of Tit. Vlf, i)i laiigiui^e closely paralleling § 703, makes it ^'Uic policy- of tlie Ujiitod Stales to insure equal employment oi)i)ortujiities foi* Federal employees without discrimination ]:)ecause of . . . national origin Civil Rights Act of 1064, Pub. L. 88-352, §701 (b), 78 Stat. 254, re-enacted. Pub. L. 89- 554, 80 Stat. 523, 5 U. S. C. § 7151. The legislative history of that section reveals no mention of any intent on Congress' part to reverse the longstanding practice of requiririg federal em]-)loyees to be United States cit- izens. To the contrary, there is every indication that no such reversal was intended. Congress itself has on sev- eral occasions since 1964 enacted statutes barring aliens from federal employment. The Treasury, Postal Ser-\'- ice, and Generiil Government Ai)propriation Act, 1973, for example, provides that ''no part of any appropriation con- tained in this or any other Act shall be used to pay the compensation of any officer or employee of the Govern- ment of the United States . . . unless such person (1) is a citizen of the United States . . . ' Pub. L. 92-351, § 602, 86 Stat. 487. See also Pub. L. 91-144, § 502, 83 Stat. 336; Pub. L. 01-439, S 502, 84 Stat. 902. To interpret the term "national origin'' to embrace citizenship requirements would require us to conclude that Congress itself has repeatedly flouted its own declaration of policy. This Court cannot lightly find 3 Petitioners argue that it is unreasonable to attribute any great significance to these provisions in riotei mining congressional intent because the barrier to employment of noncitizens has been tucked away in appropriations bills rather than expressed in a more affirma- tive fashion. We disagree. Indeed, the fact that Congress has occasionally enacted exceptions to the general barrier indicates to us that Congress was well aware of what it was doing. See, e. g.,- Pub. L. 92-204, § 703, S5 Stat. 726 (Dept. of Defense); Pub. L. 91-^82, 84 Stat. 823 (Library of Congress) . 390 ESPINOZA V. FARAH MFG. CO. 91 86 Opinion of the Court sucli a breach of faith. See Bate Refrigerating Co. v. Sulzberger, 157 U. S. 1, 38 (1895). So far as federal employment is concerned, we think it plain that Con- gress lias assumed that the ban on national-origin dis- crimination in § 701 (b) did not affect the historical practice of requiring citizenship as a condition of em- ployment. See First National Bank v. Missouri, 263 U. S. 640, 658 (1924). And there is no reason to believe Congress intended the term "national origin" in § 703 to have any broader scope. Cf. King v. Smith, 392 U. S. 309,330-331 (1968). Petitioners have suggested that the statutes and regu- lations discriminating against noncitizens in federal em- ployment are unconstitutional under the Due Process Clause of the Fifth Amendment. We need not address that question here,* for the issue presented in this case is not whether Congress has the power to discriminate against aliens in federal employment, but ratlier, whether Congress intended to prohibit such discrimination in private ehiployment. Suffice it to say that we cannot conclude Congress would at once continue the practice of requiring citizenship as a condition of federal employ- ment and, at the same time, prevent private employers from doing likewise. Interpreting § 703 as petitioners suggest would acliieve the rather bizarre result of pre- venting Farah from insisting on United States citizen- ship as a condition of employment while the very agency charged with enforcement of Tit. VII would itself be required by Congress to place such a condition on its own personnel. * We left this question undecided in Sugannan v. Dougall, 413 U. S. G34, 640 n. 12 (1973). See Jalil v. Hampton, 148 U. S. App. D. C. 415, 460 F. 2d 923, cert, denied, 409 U. S. SS7 (1972); Mow Sun Wong v. Hampton, 333 F. Supp. 627 '.(ND Cal. 1971). 391 92 OCTOBER TERM, 1973 Opinion of the Court 414 U.S. The District Court drew primary support for its hold- ing from an interpretative guideline issued by the Equal Employment Opportunity Commission which provides: "Because discrimination on tlie basis of citizenship has the effect of discriminating on the basis of national origin, a lawfully immigrated alien who is domiciled or residing in this country ma}' not be discriminated against on the basis of his citizen- ship . . . 29 CFR § 1606.1 (d) (1972). Like the Court of Appeals, we have no occasion here to question the general validity of this guideline inso- far as it can be read as an expression of the Com- mission's belief that there may be many situations where discrimination on the basis of citizenship would have the effect of discriminating on the basis of national origin. In some instances, for example, a cit- izenship requirement might be but one part of a wider scheme of unlawful national-origin discrimination. In other cases, an employer might use a citizenship test as a pretext to disguise what is in fact national-origin discrimination. Certainly Tit. VII prohibits discrimi- nation on the basis of citizenship whenever it lias the purpose or effect of discriminating on the basis of na- tional origin. "The Act proscribes not only overt dis- crimination but also practices that are fair in form, but discriminatory in operation." Griggs v. Duke Power Co., 401 U. S. 424, 431 (1971). It is equally clear, however, that these principles lend no support to petitioners in this case. There is no indi- cation in the record that Farali's policy against employ- ment of aliens had the purpose or effect of discriminating against persons of Mexican national origin.' It is con- * There is ho* suggestion, for example, that .the company refused to hire aliens of Mexican or Spanish-speaking background while 392 ESPINOZA V. FAHAH MFG. CO. 03 86 Opinion of the Court ceded tliat Farah accepts employeq^s of Mexican origin, provided the individual concerned has become an Ameri- can citizen. Indeed, the District Court found that per- sons of Mexican ancestry make up more than 96% of the employees at tlie company's San Antonio division, and 97% of those doing the work for which Mrs. Espinoza applied. AVhile statistics such as these do not auto- matically shield an employer from a charge of unlawful discrimination, the plain fact of the matter is that Farah does not discriminate against persons of Mexican national origin witli respect to employment in the job Mrs. Espinoza sought. She was denied employment, not because of the country of Iier origin, but because she had not yet achieved United States citizenship. In fact, the record shows that the worker hired in place of Mrs. Espinoza was a citizen with a Spanish surname. The Commission's guideline may have significance for a wide range of situations, but not for a case such as this where its very premise — that discrimination on the basis of citizenship has the effect of discrimination on the basis of national origin — is not borne out.*" It is liiring those of other national origins. Respondent's president informed the EEOC'b Regionnl Director investigating the charge that once in its history the company had made a single exception to its policy against hiring aliens, but the nationality of the indi- vidual concerned is not revealed in the record. While the company asks job applicants whether they are United States citizens, it makes no inquiry as to their national origin. • It is suggested that a refusal to hire an alien always disadvan- tages that person because of the countr}' of his birth. A person born in the United Stales, the argument goes, automatically obtains citizenship at birth, w^hile those bom elsewhere can acquire citizen- ship only through a long and sometimes difficult process. See 8 U. S. C. §§ 1423 (1), 1423 (2), 1427 (a), and 1430. The answer to this argument is that it is not the employer who places the burdens of naturalization on those bom outside the country, but Congress itself, through laws enacted pursuant to its constitutional power 393 94 OCTOBER TERM, 1973 Opinion of the Court 414 U.S. also significant to note that the Commission itself once held a different view as to the meaning of the phrase "national origin." When first confronted with the ques- tion, the Commission, throii^rh its General Couns^;!. said:.^ " /National origin^ refers to tlie country from which the individua l or his forebears came_ . . . , not to whether or hot he is a United States citizen . . . " EEOC General Counsers Opinion Letter, 1 CCH Employment Prac. Guide II 1220.20 (1967)/ The Commission's more recent interpretation of the statute in the guideline relied on by the District Court is no doubt entitled to great def- erence, Griggs v. Duke Power Co., supra, at 434; Phillips V. Martin Marietta Corp,, 400 U. S. 542, 545 (1971) (Marshall, J., concurring), but that deference must have limits where, as here, application of the guideline would be inconsistent with an obvious con- gressional intent not to reach the employment prac- tice in question. Courts need not defer to, an adminis- trative construction of a statute where there are *'com- "[t]o establish an unifonn Rule of NaturalizatioD." U. S. Const., Art. 1, §8, cl. 4. Petitioners' reliance on Phillips v. Martin Marietta Corp., 400 U. S. 542 (1971), is misplaced for similar reasons. In Phillips we held it unlawful under §703 to have "one hiring policy for women and another for men . . . Id., at 544. Farah, however, does not have a different policy for the foreign born than for those born in the United States. It requires of all that they be citizens of the United States. ^ The Opinion Letter was addressed to the question whether it was lawfid to discriminate against nonresident aliens in favor of citizens and resident aliens, and expressly reserved any decision "regarding discrimination in favor of United States citizens and agamst resident aliens." Nevertheless, the definition of "national origin" set forth 'in the Letter is inconsistent with that suggested by petitioners here. 394 ESPINOZA v. FARAH AIFG. CO. 05 86 Opinion of the Court pelling indications that it is wrong." Bed Lion Broad- casting Co. V. FCC, 395 U. S. 367, 381 (1969); see also Zuber v. Allen, 396 U. S. 168, 193 (1969); Volks- wagenwerk Aktiengesellschaft v. FMC, 390 U. S. 261, 272 (1968). Finally, petitioners seek to draw support from the fact that Tit. VII protects all individuals from unlaw- ful discrimination, whether or not they are citizens of tlie United States. We agree that aliens are protected from discrimination under the Act. That result may be de- rived not only from the use of the term "any individual'* in § 703, but also as a negative inference from the ex- emption in § 702, which provides that Tit. VII "shall not apply to an employer with respect to the employment of aliens outside any State " 42 U. S. C. § 2000e-l. Title VII was clearly intended to apply with respect to the employment of aliens inside any State.* The question posed in the present case, however, is not whether aliens are protected from illegal discrimi- nation under the Act, but what kinds of discrimination the Act makes illegal. Certainly it would be unlawful for an employer to discriminate against aliens because of race, color, religion, sex, or national origin — for ex- ample, by hiring aliens of Anglo-Saxon background but refusing to hire those of Mexican or Spanisli ancestry. Aliens are protected from illegal discrimination under the Act, but nothing in the Act makes it illegal to dis- criminate on the basis of citizenship or alienage. We agree with the Court of Appeals that neither the language of the Act, nor its history, nor the specific 8 *Title VII of the Civil Rights Act of 1964 protects aU indi- rcITgion, sex, or national origin.'^ 29 CFR § 1606.1 (c) (1972). 395 06 OCTOBER TERM, 1973 Douglas, J., dissenting 414 U. S. facts of this case indicate that respondent has engaged in unlawful discrimination because of national origin." Affirmed. Mr. Justice Douglas, dissenting. It is odd that the Court whicli holds that a State may not bar an alien from the practice of law * or deny em- ployment to aliens * can read a federal statute that pro- hibits discrimination in employment on account of "national origin" so as to permit discrimination against aliens. Alienage results from one condition only: being born outside the United States. Those born within the coun- try are citizens from birth. It could not be more clear that Farah's policy of excluding aliens is de jacto a policy of preferring those who were born in this country. Therefpre the construction placed upon the ''national origin" provision is inconsisteiit with the construction this Court has placed upon the same Act's protections for persons denied employment on account of race or sex. In connection with racial discrimination we have said that the Act prohibits "practices, procedures, or tests neutral on their face, and even neutral in terms of in- tent," if they create "artificial, arbitrary, and unnecessary barriers to employment when the barriers operate in- • Petitioners argue that respondent's policy of discrin ii;: against aliens is prohibited by 42 U. S. C. § 1981, which pi s: "All persons within the jurisdiction of the United States shn ve the same right in every State and Territory to make and cniorcc contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is ejijoyed by white citizens . . . This issue was neither raised before the courts below nor presented in the petition for a writ of certiorari. Accordingly we express no views thereon. */n Tc Griffiths, 413 U. S. 717 (1973). « Sugarman v. D(nLgaU, 413 U. S. 634 (1973). 396 ESPINOZA v. FARAH MFG. CO. 07 86 DouisLAS, J., dissenting vidiously to discriminate on the basis of racial or other impermissible classificaiion.'* Griggs v. Duke Power Co,, 401 U. S. 424, 430-431 (1971) (emphasis added). ' There we found that tlie employer could not use test or di- ploma requirements which on their face were racially neutral, when in fact those requirements had a de facto discriminatory result and the employer was unable to justify til em as related to job performance. The tests involved in Griggs did not eliminate all blacks seeking employment, just as the citizenship requirement here does not eliminate all applicants of foreign origin. Respondent here' explicitly conceded that the citizenship requirement is imposed without regard to the alien's qualifications for the job. These petitioners against whom discrimination is charged are Chicanes. But whether brown, yellow, black, or white, the thrust of the Act is clear: alienage is no barrier to employment here. Griggs, a,s I under- stood it unt^l today, extends its protective principles to all, not to blacks alone. Our cases on sex discrimi- nation under the Act yield the same result as Griggs, See Phillips v. Martin Marietta Corp,, 400 U. S. 542 (1971). The construction placed upon the statute in the ma- jority opinion is an extraordinary departure from prior cases, and it is opposed by the Equal Employment Opportunity Commission, the agency provided by law with the responsibility of enforcing the Act's pro- tections. The Commission takes the only permissible position: that discrimination on the basis of alien- age always has the effect of discrimination on the basis of national origin. Refusing to hire an individual because he is an alien "is discrimination based on birth outside the United States and is thus discrimination based on national origin in violation of Title VII." Brief 397 98 OCTOBER TERM, 1973 Douglas, J., dissenting 414 U.S. for Commission as Amicus Curiae 5. The Commis- sion's interpretation of the statute is entitled to great weight. There is no legislative history to cast doubt on this construction.' Indeed, any other construction flies in the face of the underlying congressional policy of removing "artificial, arbitrary, and unnecessary barriers to employ- ment." McDonnell Douglas Corp. v. Green, 411 U. S. 792,806 (1973). Mrs. Espinoza is a permanent resident alien, married to an American citizen, and her children will be native- born American citizens. But that first generation has the greatest adjustments to make to their new coun- try. Their unfamiliarity with Amtcrica makes them the most vulnerable to exploitation and discriminatory treat- . ment. They, of course, have the same obligation as American citizens to pay taxes, and they are subject to the draft on the same basis. But they have never re- ceived equal treatment in the joti market. Writing of the immigrants of tlie late 1800's, Oscar Handlin has ^ said: , . "For want of alternative, the immigrants took the lowest places in the ranks of industry. They suffered in consequence, from the poor pay and mis- erable working conditions characteristic of the sweat- *The only legislative history the majority points to is Congress- man Roosevelt's definition of "national origin": "It means the country from which you or your forebears came. . . . You may come from Poland, Czechoslovakia, England, France, or any other coun- tr>'." Ante, at 89. But that only makes clear what petitioners hero argue — ^that Mrs. Espinoza cannot be discriminated against because she comes from a foreign country. The majority's mention of the deletion of the word "ancestry," ibid., is certainly irrelevant. Obviously "national origin" comprehends "ancestry," butj^Coi> * glfiSSg^an^JloQscvelt^po^^ only where one's forebears were born, but where one himself was born. i 398 ESPiNOZA r. FARAH MFG. €0^ fi& 86 Douglas, J., dissenting sliops and the homework in the garment trades and in cigar making. But they were undoubtedly better off than the Irish and Germans of the 1840's for whom there had been no place at all." The New- comers 24 (1959). The majority decides today that in passing sweeping legislation guaranteeing equal job opportunities, the Con- gress intended to help only the immigrant's children, excluding those "for whom there [is] no place at all." I cannot impute that niggardly an intent to Congress. [Whereupon, at 1:15 p.m. the subcommittee adjourned.] o I UNIVERSITY OF FLORIDA 3 1262 08128 436 5