STATEMENT OF ROBERT CHARLES SMITH, NATIONAL COMMANDER, THE AMERICAN LEGION, WASHINGTON, D.C.

Mr. SMITH. I am Robert Charles Smith, national commander of the American Legion.

Senator PERCY. Could I just make this statement because I will miss an airplane if I don't leave very quickly.

We welcome you very much. I have read all of the testimony and I will study it further, but I will have to leave.

Senator PELL. I would also add that any statement you wish to have inserted in the record can be done in full in the event you wish to abbre viate your testimony.

Mr. SMITH. I have done that.

It is a distinct pleasure for me to appear before you, first to represent the viewpoint of the American Legion as adopted by our recently concluded 59th national convention, and to spell out-objectively and dispassionately-what our concerns are and why we object to these specific treaties.

With me this afternoon is our chairman of the American Legions' Foreign Relations Commission, Dr. Robert P. Foster, who for the past 14 years has served as president of Northwest Missouri State University located in Maryville. Dr. Foster has visited Panama and, along with Commission members, has examined the Panama situation for quite some time.

Today, I have come to speak for our 4 million members of the American Legion and the American Legion Auxiliary. We represent a composite and microcosm of the United States. For most of us in the American Legion and all of our citizens are either buyers or sellers of commodities passing through the Panama Canal.

AMERICAN LEGION APPREHENSION

Moreover, all of us are dependent on the protection of the U.S. Navy to control the seas surrounding our country in the center of the Western Hemisphere. Quite frankly, the main thrust from every Legion post has been the same deep apprehension about the proposed treaties with Panama.

We in the American Legion believe under our system of Government that the will of the people is very important. The knowledge, the will, and the dedication of our people provide the amperage to our national life.

I will now discuss the reservations and objections which we have to these proposed treaties. I have summarized my remarks, but ask that my entire statement be placed in the record.

Senator PELL. Without objection, that will be done.

STRATEGIC, MILITARY IMPORTANCE OF U.S. CONTROL

Mr. SMITH. The first is the strategic and military importance of continued U.S. control of the canal and the Canal Zone. At the onset, we realize that the United States has a one-ocean Navy with a global responsibility. Today all but 13 of the ships in the U.S. Navy-the exception being the large aircraft carriers can pass through the canal.

Within the military community, and among the retired and active military, there is a great diversity of opinion. We are hearing from many military leaders and the majority of these opinions, like the majority of our citiezns, are opposed to the giveaway of the zone and the canal.

As you are aware, Admiral Moorer forcefully reaffirmed his views to this committee earlier this week and clearly stated the indispensable strategic importance of the canal.

U.S. ECONOMIC INTERESTS

From an economic perspective, the canal is vital to U.S. interests. In 1975, approximately 14,000 ships transited the canal of which 45 percent originated in the United States and 23 percent were bound for the United States. No other nation even approaches the invaluable, economic stake which we have in the canal. However, the canal is important to all maritime commercial nations since 96 percent of the world's merchant fleet can transit it.

The canal is just this year assuming an additional commercial importance to the United States as Alaskan oil begins to flow. The west coast of the United States can accommodate only 700,000 barrels a day. This means that approximately 500,000 barrels a day cannot be used on the west coast and must be transported to the east.

From an overall economic perspective, should the tolls go up another 25 to 30 percent as projected by Ambassador Sol Linowitz-and the tolls since 1973 have already gone up about 50 percent-many of our exports will be priced out of the world market. The grain producers and dealers, for example, frequently depend on a fraction of 1 percent as their profit margin.

In a Journal of Commerce article, the president of Lykes Brothers Steamship Co., Mr. W. J. Amoss, Jr., expressed his opposition to the treaty because of its adverse impact on canal users. Mr. Amoss, who had previously supported the treaty, said the proposed treaty spelled sheer disaster for operators east of the canal and going westbound through the canal.

And just what are the economic facts for such ports and shipping centers as Boston, New York, Baltimore, Hampton Roads, Charleston, Mobile, Houston, and New Orleans?

I do not wish to overstate the dangers we foresee for Louisiana and the Gulf States, but 38 percent of all waterborne commerce, over $30 million in world trade, move from the gulf ports. Over one-half of all the grain exported from the United States moves from the gulf ports and about one-third of these grains pass through the Panama Canal. The Port of New Orleans is the Nation's No. 1 importer of iron and steel products-87 percent of these products arrive via the Panama Canal.

Hampton Roads, for example, is the world's largest coal port. Over half of the 32 million tons of coal leaving Hampton Roads goes through the Panama Canal.

We noticed in a letter to the editor of the Washington Post on October 7, 1977 that the port of Baltimore has a vital interest in the Panama Canal. At least 20 percent of Baltimore's foreign commerce utilizes the canal.

Moreover, at the present time, the United States has an overall investment in Panama of $7 billion. To add insult to injury, the treaty proposes that we pay some $50 million per year, plus about $350 million in economic and military aid to have the Torrijos group take over the territory and property.

PANAMANIAN GOVERNMENT

As this committee is aware, Panama is a dictatorship, or in the words of Ambassador Bunker before Congressman Murphy's committee, an "authoritarian" government.

Freedom House, the respected organization which ranks countries on the basis of human rights, gives Panama the lowest ranking in Latin America. Panama received the same 1977 ranking on political and civil liberties as the Soviet Union and was rated even lower than Cuba.

As we are all aware, the Panamanian Constitution requires a plebiscite for ratification of any new treaty. It will be held on October 23 for these two treaties. The sad irony is that the controlled and censored Panama press "guided" in the terms of our chief negotiator-will never give a full and objective account of the treaty to the Panamanian people.

TORRIJOS TIES TO SOVIET UNION, CUBA

Politically, Torrijos has also busied himself with making closer political and commercial ties with the Soviet Union.

Of deepest concern is Torrijos' close ties with Fidel Castro and Cuba. Cuba under Castro continues to aggressively export and pursue Communist domination and control of other nations.

Several weeks ago, the New York Times reported that 4,000 more Cubans were sent to Angola recently to "stabilize the nation's most serious crisis since the 1976 civil war." This to me clearly indicates that Castro hasn't backed off one inch from his declared goal of Communist domination of the Western Hemisphere and the world.

PANAMA TREATY VIOLATION

Also of concern is the reliability of the Panamanian dictator to live up to what he signs. Panama has violated the present treaty at least 12 times during the past 2 years.

Our Ambassador, whose official car was shamelessly destroyed sereral days ago, has protested such lawless treaty violations, but one must question the wisdom of appeasing and making further conces sions to a government whose recent history is pockmarked with deliberate violations of the current treaty.

I will now turn to the treaties and the accompanying annex and protocol. This analysis is based upon the limited time in which these treaties have been available to this layman and I urge each member of this committee to scrutinize these documents.

SOVEREIGNTY QUESTION

First, sovereignty is the crucial factor in the new treaties. Both the prolog to the canal treaty, and at least six other times in the document,

Panamanian sovereignty over the U.S. zone and the canal is acknowledged. As I stated earlier, once Torrijos is granted sovereignty all other questions are irrelevant.

TRANSFER OF PROPERTY

Second, article II, section 1, of the canal treaty specifies that it should "be subject to ratification in accordance with the constitutional procedures of the two parties." However, it would appear that the executive branch is seeking ratification of the treaties without seeking enabling legislation from the House of Representatives to transfer real properties, appropriation of funds and perhaps other legislation which is not spelled out, as required to the Constitution of the United States. This bypassing of the House of Representatives appears to be a usurpation of legal powers which is clearly conveyed to the House by the Constitution.

NEW CANAL CONSTRUCTION

Third, article XII, section 2 (b), states that:

During the duration of this treaty the United States of America shall not negotiate with third states for the right to construct an interoceanic canal on any route in the Western Hemisphere, except as to two parties may otherwise agree.

In plain terms, the United States has surrendered its rights to negotiate for a competing canal elsewhere in the Western Hemisphere unless it has Panama's consent.

INTERPRETATION OF INTERVENTION

Additionally, I have strong reservations and objections to the neutrality treaty:

First, only article IV of this treaty bears upon U.S. responsibilty concerning the neutrality of the canal and the entire document is so vague as to be virtually meaningless. In my lay reading of the entire neutrality treaty, I find no assurance that the United States can intervene to assure the neutrality of that vital area.

My serious reservation was reinforced by Carlos Lopez Guevara's quote in an Associated Press interview last week:

It is sad to see that high officials of the United States Government are affirming that these treaties give the United States the right to intervene. There is nothing in it that states this nor that could serve as a basis for American intervention.

EXPEDITIOUS PASSAGE

Second, article VI, section 1, states that vessels of war and auxiliary vessels of the United States and the Republic of Panama "will be entitled to transit the canal expeditiously."

The exact meaning of the word "expeditiously" is vague at best. Even more confusing is the interpretation placed on the word "expeditiously" by the chief Panamanian negotiator, who said that the United States would not be given "preferential rights."

Just last week, Mr. Guevara said:

This neutrality treaty gives the United States the right to hope that Panama and all the countries in the world will respect the right of American ships to transit the canal, but that is the only right it has received.

In Louisiana we regard a contract as no better or no worse than the intent and interpretation of the contracting parties. Treaties are actually a form of international contracts where nations agree to abide by the terms specified. As this committee knows, we are getting a wide variety of interpretations on such matters as the right of intervention, the right of priority passage for U.S. warships.

Escobar Bethancourt has recently told Panamanian audiences that the United States wanted but did not get "priority or privileged passage." This information was later authenticated in a "confidential" cable released by Senator Dole which quotes Lopez Guevara that article IV on neutrality urges U.S. officials to stop using the word "intervention," and further stating that intervention is prohibited by international law.

It would be unwise at best to even further consider ratification of any treaties in any form until the serious differences in United States and Panamanian interpretations are clearly and unquestionably resolved.

U.S. MILITARY AND NATIONAL SECURITY LOSSES

U.S. military and national security losses alone are sufficient to reject the treaty. We are giving up our naval fleet flexibility at a time when we have fewer than 400 ships in the entire U.S. Navy. Economic losses of the United States are difficult to calculate, but logic dictates that U.S. consumers and exporters are going to pay the toll increases. Additionally, the cost to the U.S. taxpayer is in the billions. The Torrijos government is living on borrowed money and borrowed time.

HUMAN RIGHTS UNDER TORRIJOS

Politically, human rights under Torrijos are not better than they were under Hitler during the 1930's and yet by supporting this treaty, our U.S. Government is propping up a dictatorship. Worse yet, our Government is forcing Americans to live under totalitarian rule and abide by its laws and decrees.

PUBLIC OPPOSITION

The pressures the White House can bring are enormous, as all of us know. The resources at the President's disposition almost deny our collective imagination. We in the Legion, while recognizing the awesome power of the Presidency and the executive bureaucracy, also believe that the ultimate power in the United States resides with the people-with people like our members.

I will close with one question: If this treaty is basically good for the United States, why does the administration have to make such an effort to prove to Americans that it is in our national interest?

We believe this proposed treaty will ultimately be decided by the people. We believe this is one defeat the United States can avoid. It is a loss we need not accept and you can count on the American Legion posts to stand firm.

Thank you, Mr. Chairman.

[Mr. Smith's prepared statement follows:]