Cuba and the Caribbean

24. Peaks were reached during World War II, the Korean conflict, the Cuban crisis and the Vietnam operation. The Vietnam peak came in fiscal year 1968 when there were 1,504 Government transits carrying 8.5 million long tons of cargo.

25. Of all U.S. Government-owned ships, only 29 Navy carriers in commission, in reserve, or under construction cannot transit the Panama Canal because of beam or length. These range from the Nimitz, under construction, to the converted Essex-class carriers of World War II.

26. Typical of the large naval vessels which can transit are the battleships such as the New Jersey (888 feet by 108 feet), which transited in 1968 en route to Vietnam, and the amphibious assault ships, such as the Guam (592 feet by 105 feet), which transited in June of this year en route to Peru to render emergency assistance following the earthquake.

27. The Military Sea Transportation Service of the Navy operates three troop transports and has 13 more in reserve. Additional vessels are in the Marad reserve fleet. All these are of conventional size and can transit the canal.

28. Careful, farsighted planning has been the keynote throughout the U.S. construction and operation of the canal. Planning has never stopped. It started long before the first steam shovel bit into the dirt, and it continues today. Trends are studied and comprehensive analyses made to weigh the demands of future commerce against the capabilities of the waterway.

29. Over the life of the canal, this planning has led to many projects, some large, some small, which have made it possible to handle today's traffic efficiently. This traffic consists of more ships and larger ships than the canal builders visualized.

30. These projects have all been part of the canal maintenance program. The largest of these projects, the widening of the Gaillard Cut from 300 feet to 500 feet is rapidly nearing completion. Other projects have included the replacement of the original towing locomotives which assist ships through the locks, the procurement of additional tugs, the widening of entrance channels, the replacement and improvement of machinery and equipment, and provision of additional dependable supply of lockage water.

UPDATED PROJECTIONS

31. Recently, the Panama Canal Company has updated projections of future canal traffic and plans for meeting the expected demand. In this latest planning, we have recognized that competition is accelerating, and we expect to see more, and different kinds in coming years. We must take into account such developments and ideas as the huge tanker and bulk carriers now coming into service, pipelines, container ships, "land bridges", and big cargo airplanes.

32. Economic Research Associates of Los Angeles, Calif., has just completed for us a traffic forecast through the year 1985. They estimate that commercial transits in 1975 will be about 13,700 (in 1969 there were 13,150); in 1980, these will grow to 15,200, and in 1985, to 17,900. Added to these figures would be the Government transits which

will probably run less than 500 per year. Economic Research Associates have predicted that by 1985, about 33 million tons of potential canal cargo will bypass the present canal, moving in ships too large to fit through our locks, but in 1985, 168 million tons will transit the canal in ships which will go through.

33. A. T. Kearney & Co. of Chicago has just completed for the Panama Canal Company a companion study to determine what is the maximum practical capacity of the present canal and what would be necessary to achieve it. This study shows that with completion of 15 additional projects at a cost of $92 million. the canal capacity can be increased to 26,800 per year enough to carry us well beyond 1985 and perhaps even to the end of the century.

34. Details on these two studies may be found in the record of hearing before the Subcommittee on the Panama Canal of the House Committee on Merchant Marine and Fisheries, April 22, 1970 (serial No. 91-25).

35. Looking beyond the time frame of these two studies, the United States is now completing a major study which will take into account the present canal, the program for developing its maximum capacity which I've just mentioned and go on to consider additional measures which might be taken to meet the needs of trans-Isthmian ship traffic. These include the third locks project, the Terminal Lakes plan, and the sea level canal.

36. This study is being conducted by the Atlantic-Pacific Interoceanic Canal Study Commission, headed by Mr. Robert Anderson (Public Laws 88-809 and 90-359). Their study has focused on four potential areas for trans-Isthmian crossings. They will complete their work this fall and on December 1, 1970, will submit their report to the President for transmittal to Congress.

CONCLUSION

For almost 56 years, the Panama Canal has served shipping without interruption, a tribute to the abilities of the men who built it and the men who have operated, maintained, and defended it. From the time it opened, the canal has stimulated world trade and contributed to increased economic opportunity for many nations. For over half a century, it has made possible a better life for people of the world. I believe it is clearly in the U.S. interest that it continue to be operated, maintained, defended, and augmented as necessary to continue this outstanding record.

Mr. FASCELL. Thank you very much, General Leber for a very thorough statement. I am glad you took the time to prepare and and deliver it because I think it is very important to review issues relating to the Panama Canal from the beginning, and place them in perspective.

Part of your statement contained familiar information. On the other hand, updated the way you have done it, it not only helped us refresh our memory but has anticipated a great many questions. I am grateful for it.

LIMITATIONS ON CANAL'S POTENTIAL

As I understand it, the principal limiting factor for maximum potential of the Canal is the size of the locks?

General LEBER. Yes, sir. That is, with the growing number of larger ships and, of course, the number of ships we can put through. The maximum number we feel we can put through with improvement is 26,800 a year. That number we don't expect to see for at least 15 years and perhaps 20 or 25.

Mr. FASCELL. Now, lock size is a limiting factor on the size of vessels.

General LEBER. Yes, sir.

Mr. FASCELL. What is the limiting factor on the number of vessels in transit?

General LEBER. Well, it is a combination of the lock, the channel, the water for lockage. Many factors.

To arrive at this answer I have given you of 26,800 ships per year, we developed a mathematical model of the canal with all of its limitations in the model. With this we were able to simulate traffic and we could put in 15,000 ships and see where the bottlenecks develop; 16,000 and so on.

Mr. FASCELL. In other words, all the time factors were fed into the computer study?

General LEBER. Right, and where you could eliminate the bottleneck you did it and then run it again. With many runs we came up with this plan and this answer that, with improvements, we can get to 26,800.

Mr. FASCELL. This was the basis for the Kearney Study?

General LEBER. Yes, sir.

Mr. FASCELL. The Commission study which is scheduled to be submitted in December, that will be a comparative study?

General LEBER. No, sir; it is an extension. [Security deletion.] We have worked very closely, I might say, with the Commission, throughout their work, but they are looking to a longer time frame. They are going out into the next century. Seventy-five years. When you try to project 75 years, it is somewhat difficult. They are looking to the day when there will be more than 26,800 ships that want to use the canal. How do you handle it? They are considering the alternatives. One alternative would be to put in the third set of locks, a project which you may recall was started back in 1939, worked on until 1942, about $75 million invested in digging the trenches for the locks. The war was on; they saw they couldn't finish it in time to be of use to the war so they suspended the project and it has remained suspended, but it is one possibility for increasing the capacity beyond this 26,000.

Mr. FASCELL. How would the third set of locks increase traffic in the present canal?

General LEBER. You would have another lane to put ships through. Our locks now have two lanes. You would just add another lane and roughly you have increased the capacity by a third.

Mr. FASCELL. Isn't there one exit and one entrance?

General LEBER. They are wide enough for ships to pass. It takes longer to get through the locks than it does through the channels. Mr. FASCELL. Does the Comission study anticipate a lessening of traffic?

General LEBER. No, sir.

Mr. FASCELL. In other words, it is predicated on an increase, regardless?

General LEBER. They have made studies of traffic, projections, and all of the projections they have received indicate an increase. They have received none that indicate a decrease, so they are planning on an increase.

Mr. GROSS. How much of the $75 million is salvageable of the work that was done?

General LEBER. It would all be usable. The work that was done was excavation. No steel, concrete, or gates were put in. It is just a ditch. If you did decide to go through with the third locks project, that ditch would probably be used. It might have to be increased in size. You might decide now to make the third lane longer and wider, which would mean a little more excavation, but it is made up of two ditches. One on the Atlantic and one on the Pacific side.

One alternative, one talked about from the beginning of time almost, is the sea level canal, which the Commission has studied and will report on in detail. The feasibility of it from a construction standpoint, an engineering standpoint; the economics of it; the security value of it; the political value. All of these things will be covered in the Commission's report.

U.S. OPERATION OF PANAMA CANAL

Mr. GROSS. You concluded your statement, General, with this: "I believe it is clearly in the U.S. interest that it continue to be operated" that is the Canal-"maintained, defended, and augmented 'as necessary' to continue this outstanding record."

I don't want to engage in semantics but are you saying "defended and operated" by the United States or are you just leaving this open? General LEBER. [Security deletion.]

Mr. GROSS. Now, let me be really direct. Do you believe the canal should continue to be operated by the United States?