Envío Digital
Central American University - UCA  
  Number 117 | Abril 1991


Central America

Panama: Eternally Condemned

Jesuit of Latin America

"Condemned to live under the Pentagon's umbrella," was General Omar Torrijos' comment as he signed the Canal Treaties at the OAS in Washington in 1977. The December 1989 Panama invasion and the events of 1990, particularly the new US intervention on December 5, confirm Torrijos' sad prediction. The US had declared again and again that it intended to oust Noriega to protect democracy and US interests, even though he was employed by the CIA for 20 years, as revealed by legal proceedings in Miami. Restoring democracy and liberating the country from a dictator are the same arguments now used against Hussein in the Middle East.

The United States has always publicly denied that it wants to assure its military presence in Panama after the year 2000, but each day it becomes more evident that it has decided to remain in the Canal Zone at any cost. From the December 1989 invasion to the December 1990 military intervention, all US actions support that goal: its continuous intervention in every government ministry, in economic strategy and in the formation of the armed forces; its refusal to compensate for damages from the economic boycott and the invasion, calculated at $1.5 billion, or even to disburse the aid that was promised, all of which caused the government's deterioration; and its use of Colonel Herrera's supposed coup as a way to pressure the Endara government.

Though the 1989 invasion was the third in Panama's brief history, it was decisive in charting the nation's future course. The eternal condemnation that Torrijos predicted is explicit in the Santa Fe Committee's statement that "once a democratic government is in power, the United States and Panama should seriously begin to plan an appropriate administration of the Canal. At the same time, discussions should begin with respect to its realistic defense after the year 2000. Those talks should include the United States' retention of a limited number of installations in Panama, for an adequate projection of strength in the Western hemisphere."

Japan accepts the blow

The US also wanted to clearly define its exclusive hegemony over the bridge between the Pacific and the Atlantic and block Japan's growing presence in Panama. In recent years, independent of Washington, Japan had established economic ties with Panama, making it the second largest recipient of Japanese investment after the United States. Totaling $12 billion, it was more than Japan's investments in all of Latin America put together, or than in Great Britain and Germany.

Panama's financial center was led by Japanese banks, as was the Free Zone of Colón, the second largest free zone in the world. "Flags of convenience" registered in Panama in the second largest commercial fleet in the world were preeminently Japanese, and Japan was approaching the United States as the principal user of the canal. When the US began its economic boycott against the Noriega government, Japan remained surprisingly neutral and even supplied humanitarian aid to Panama.

The boycott and consequent economic and political destabilization led to a 27% drop in Panama's gross domestic product. It also provoked the closure of several Japanese banks, its school and its government export company, and the transfer of Japanese economic activities to Miami, Costa Rica and other Latin American countries. The invasion itself demonstrated to Japan that the United States would assert its exclusive hegemony at any cost. Japan could participate in a tripartite accord for a new canal and in Panama's platform of transnational services only as long as the US deemed those activities convenient.

The financing of US military operations in the Gulf crisis by Japan and Germany, its economic competitors, and the military support from other allies confirm that they all assimilated the message of the Panama invasion.

US impunity

The US and Panamanian governments have stated that between 300 and 700 were killed in the invasion, while the Human Rights Commission, the Church and Ramsey Clark's Independent Commission on Panama claim a total of 3-7,000 dead and disappeared. The Committee of Families of the Dead and Disappeared got two common graves opened in Panama City and Colón, one of which contained 120 bodies. The wall of silence around Panamanian casualties should be a warning about what may happen in the Gulf war. An independent international investigation into the human costs of the Panama invasion is crucial as a safeguard against similar interventions that violate international law and traumatize the civilian population.

The majority of the 15,000 people who lived in some 3,000 houses in the poor Chorrillo neighborhood, flattened on December 20, are still living in hangars, without reparations of any kind. The government intends to use their original land for public and private investments.

Given Panama's corruption and the Noriega dictatorship, some 80% of the Panamanian people accepted US military intervention as the quickest solution to a national disgrace. Even the Archbishop of Panama called the invasion a "liberation." At the time, only a minority considered it shameful and a national trauma that will take many years for most people to overcome.

The political triumvirate: Low-intensity democracy

In May 1989, the Endara-Arias-Ford opposition slate was elected. The triumvirate united the Christian Democrats, MOLIRENA and the Authentic Liberal Party, all previously political adversaries. Those elections, in reality, were a plebiscite against Noriega, but it seems that the winners have not understood this. They did not have a coherent political project, and the figure of Endara was no more than an attempt to capitalize on Arnulfo Arias' populism; the intellectual and political superiority of the vice-presidential candidates was obvious.

This political alliance was put together with financial support and heavy pressure from the United States, over the personal divisions and political contradictions of historically opposed groups. The US Administration did the same in Panama as it did with UNO in Nicaragua, and in both cases, upon taking power the coalitions fell to fighting for their respective power quotas. The groups in the Civilist Crusade, the anti-militarist alliance that backed the triumvirate, formed political fractions similar to those that Nicaraguan Vice-President Virgilio Godoy shaped out of the most rightwing mayors, sectors of the contras and COSEP.

Submission and tutelage is much more obvious in Panama than in Nicaragua due to Endara's lack of character. Although Violeta Chamorro has no political professionalism, she has dignity, inherited from family tradition.

This style of US-directed and partially-financed democracy in Panama and Nicaragua is similar to that of other Central American governments of diverse political stripes. There is sufficient evidence to say that this kind of interference and control reaffirms our thesis of "low-intensity democracy." That is to say, the subtlest way for the US to maintain exclusive hegemony over its backyard, after the end of the Cold War, is by orchestrating the democracy of these nations in its own interest.

The Panamanian triumvirate has suffered serious political erosion. Only 13 months after the US invasion, the public has completely abandoned the government inaugurated in the US military base in the Canal Zone. This collapse became apparent in the elections in late January to complement the National Assembly; over 60% abstained and the opposition took the majority.

The new army and police forces were purged of some 400 officials of the old Defense Forces, and a civilian was named to head the Public Forces. This restructuring, sponsored and enforced by the direct presence of US troops in the streets of Panama, was not able to guarantee stability. On the contrary, crime, holdups, bank assaults and drug trafficking have reached even greater levels than under Noriega's corrupt National Guard, provoking alarm in the population and confrontations within the triumvirate. Vice-President Ford publicly called the national army and police "clowns" and "sissies" for not taking action or daring to repress crime.

Economy: The same, only worse

In June 1990, the government announced its National Strategy for Development and Economic Modernization, a summary of its economic policy response to the crisis. The strategy proposed changing the Panamanian economy's orientation. While exports and services would continue to be the driving force of development, it detailed a combination of complementary policies to free up the labor market, reduce protection of national industry, free agricultural prices and cut transport and construction costs. Privatizing state enterprises and reducing the state's role in favor of the private sector are among the few aspects that have full governmental consensus. Nevertheless, the struggle over power quotas has meant that, as recently as December 1990, the only enterprise that had been privatized was the Hotel Taboga; the proposal to privatize Air Panama found no buyers, even though the Vice-President/Minister of Planning promised that "this country will be 100% private enterprise."

The primary obstacle to carrying out the economic plan has been the $3.8 billion foreign debt, with debt service arrears of $540 million. The government, assuming that its request for $1.5 billion in US aid to rebuild the country would be rapidly forthcoming, allotted $400 million (30.8% of the budget) to these payments, in order to become eligible for international credit. One year after the invasion, however, only $420 million had been approved, of which only $244 million had been disbursed. This was the US contribution to deal with a GDP 38% lower than in 1987, 35% unemployment in the metropolitan area, a housing deficit of 240,000 and one of the worst debt service rates, since Panama's debt is primarily with private commercial banks rather than governments as in the rest of Central America.

In July 1990, an agreement was signed with AID that exemplifies the neoliberal model in its purist extreme. No quarter is given for the country's chaotic economic situation or for the time and space required to rebuild a nation. AID and even the Pentagon have appointed US advisors to ministries and other government entities. Despite such close consultation, only commerce and construction have shown signs of recovery. Unemployment, impoverishment and the disparity in income distribution worsen daily, provoking a degree of social instability and insecurity never before seen in Panama.

The most decisive question from the grassroots sectors is: how will we survive next year, and how will we guarantee the security of common citizens? In the countryside, the question is: where do we sell our products to guarantee even a minimal income? Given this serious exacerbation of misery and instability, even the Church, which celebrated Noriega's removal and the arrival of the new government, has been critical. Its position has been even stronger than it was against Torrijismo, all the more surprising given the prominent families close to the Church that are participating in government.

The report of the National Reconciliation Commission, named by the President himself and presided over by Archbishop McGrath, is possibly the best proof of the government's incompetence and the population's disappointment and rejection. The Commission found itself forced to recognize this in the document it presented to the presidency. That document and the Panamanian Episcopate's Pastoral letter demand just compensation from the US government for damages caused by the invasion, an investigation of the dead and disappeared, an economic plan that responds to the poor majority’s urgent needs, and a national project with broad consensus that eliminates the conflicts over power that have discredited the government and decreased its ability to confront Panama's serious problems.

The people don't give up

The trauma provoked by Noriega's corruption, National Guard repression and the use of nationalist slogans as a cover for personalism and corruption was accentuated by the shame of having to accept the intervention of the country's permanent invaders to remove the dictator.

In the midst of an unending struggle to recover the Canal, maintain the struggle for national dignity and return to a decent standard of living in a wealthy country with future potential, the Panamanian workers' movement still suffers from its leaders' opportunism and corruption. They are subordinated to political leaders and co-opted by populist or liberal projects that offer perks in return for the submission of the grassroots organizations and their proposals. The December 1989 invasion paralyzed the movement for several months. February, however, saw a forceful demand for land and the first strikes in non-union sectors. The key goals were to keep jobs and prevent the elimination of the union leadership in the face of pressure from US advisors and military personnel not only in state enterprises but also in the financial center and the national beer factory.

With the increased unemployment and poverty, a huge labor march on October 16 gave rise to the National Coordinator for the Right to Life. Later that month, the government "uncovered" a supposed coup plan, led by former head of the public forces Colonel Herrera, and accused him of conspiracy and involvement with union leaders. Herrera, an opponent of Noriega who spent many years in exile, was dismissed and jailed in a "maximum security prison" on Noa Island under US military custody. On December 4, after a month and a half, he managed to "escape" and "take" the central police headquarters in the middle of the Canal Zone guarded by US troops. This was the phantasmagoric conspiracy that provoked the second US intervention.

Colonel Herrera's curious coup took place just one day before the biggest march in recent Panamanian history, to promote a national work stoppage. Popular protest had been growing with marches on the 20th of every month to condemn the US invasion and make new demands. The US military intervention responded to evidence that the opposition was organizing coherently, this time through grassroots organizations more than political parties. In addition, a nationalistic identity was reemerging. That is unacceptable to the triumvirate's bourgeoisie, which does not want to see the rebirth of a black, indigenous, poor and patriotic opposition.

The December intervention has continued with heavy labor repression, including the expulsion of hundreds of union leaders, especially from the state sector. This is in clear violation of the labor code and the Constitution, since those expulsions were not preceded by labor trials. The phenomenon of the popular movement in December and the political rejection of the government in January's legislative elections show that a nation dispossessed of its principal virtue, national sovereignty, can, in only a few months, rebuild its social and national dynamic to reject a project imposed by a foreign power.

The experiences of Nicaragua and Panama in 1990, painful and confusing for people’s consciousness, must be analyzed from the perspective of this degree of organization of a people who rebuilt a movement from the ashes of invasion and electoral defeat. Nicaragua and Panama, which could have become neoliberal showcases for the region, are instead the clearest examples of the limitations and disaster of foreign projects imposed against the interests of the majority.

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Introduction and Dedication

The United States: Redefining Central America and the World

The Neoliberal Model in Central America: Gospel of the New Right

The Nation-State Crisis: Ungovernability

Demilitarization: The Other Face of Democratization

Central America’s Grassroots Movement: A Partial Alternative

Guatemala: The Civilian Facade Collapses

Honduras: A Grassroots Party Emerging from Grassroots Organization

El Salvador: UN Mediation and Civil Negotiations

Nicaragua: Political Maturity and Economic Immaturity

Panama: Eternally Condemned

The Popular Alternative: The Agenda and Challenge for the 90s
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