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Document Number (FOIA) /ESDN (CREST): 
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Document Creation Date: 
December 20, 2016
Document Release Date: 
July 13, 2007
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Publication Date: 
December 17, 1964
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Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 k . gel%xY Ex~cur__e President: Yester ay, by arrsngetment workeeu out with McGeorge Bundy, I seat a CIA officer to Chicago to -General Eisenhower who, was enroutee Nil est by train House Washington, 3, C NSC REVIEWED NO OBJECTION TO DECLASSIFICATION AND and submitted to him a draft of your proposed statement He then suggested certain editorial changes which have been submitted to McGeorge Bundy, tament carefully and that "my approval is complete. After rereading the statement, the General ealleedd me by telephone and stated that he had read the I specifically asked if he approv.d the use of his name as indicated on the first page and he answered that doing a* was - perfectly all right with ine. You will be interested to know that your new :secretary of Conunercee, Jack Colmar, was in my office when Ike called and, white he had no knowledge of the above conversation, I told General ]Eisenhower of the new appointr*ont, put Connor on the telephone, and I am pleased to report to you that the now appointment was received with very great enthusiasm by General Fisenhowe.r. cc: Mr. McGeorge Bundy Respectfully lours, Signed: John A. McCone John A. AdcCone JAM/mfb 1cu - DCI White House Background attached. 16c - DCI Chrono Note: AI Iof DDI's office took the draft to Gen. E Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 17 c r 1964 General Dwight D. * aeenhoser'a C eents on Draft State nt on Panama, Dated 14 Decauber 19 1. A copy of the draft statement for President Johnson to give on the ftnem Canal ISO" and a COW of Intelligence mmmorandm entitled " nem--Th [anal Issue", eel No. 2043/64 of 7 ember 196# eee care- fully, read by General Dwight D. lisle bower aboard his special car on W-stbou 3 Banta a Train No. ' 1 in Chicago Illinois in the afternoon of 16 December. ca"fully resi both documents twice, r said that "by and large" the draft We of an impact. felt that a of Lrg IL* and by sing it nor* simple it ma with it. However, he bslieves that ftmaw in "all right" and that be dioesn t Iles uldbeleft fortes rhi on the a. After line 12 of page 2 to insert a state-- worth considering meat such as, "The Awnrican go rrrr*snt is prepared to begin nagotiationo with the P1U cIManisn gorers 11myt for- ' , ,Y to rt3aee the as .sting on* icl-. etdaeiitedl .lee pointing out early on in the is position. b. suggested deleting beginning with the ,jej~s on line 16 ~ through.,-tSbould h* first Sentence *-a ti~;O are oatl details not entirely 3ece ry for this stat4ment. Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 SPOCifically, be SUMO ed the fallow: Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 . . ?' on line 8 of sm4te 6 could go. He fe+eln that the sentence of w* d b inning with the Words .. ere He also, feels that the paragraph beginning in built. . . . - aei t be beeeeficial,, a bit too detailed. Re ted that the tatoly follOVIng ph could cover It by reading as follown, We will. also take every pos- sible stop to protect the es?lo eat rights and e n c transition period of both the United states citizens. .. .- The to would added to the went draft. if be, Could keep a espy of Y and said that he would again he had further suggestions he later in the afternoon or early S. ollowed 9t brief chat on the current General 21senbor reed that for about four bra tuation had moped pleased to bear that the now sta. to the kited states Is Ricardo Arias high onto personally. . He Went lone n stem tiing from as far back as 921-24 when h was stationed there as a young & my Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 ..~ war NSC REVIEWED NO OBJECTION TO DECLASSIFICATION AND CONFIDENTIAL DRAFT 12/ 14/64 STATEMENT I have reviewed the problem of a Western Hemisphere interoceanic canal in all of its aspects. The conclusions which I have reached as a result of this study have the full concurrence of the Secretary of State, the Secretary of De- fense and the Joint Chiefs of Staff. In view o' the importance of the subject, I have also consulted with General Eisenhower and Mr. Truman and they have expressed to me their general concurrenc(' with what I am about to say. On December 18 I consulted with th? leadership in Congress of both political parties and found a substantial degree of support there. In 1903 when the United States undt?rtook to build a canal through the Re- public of Panama it had the primary objective of service to world commerce. As Elihu Root, the Secretary of War when the Canal was begun, said before the United States Senate in 1913: By public declarations, by the solemn asservations of our treaties with Colombia in 1846, with Great Britain in 1850, our treaties with Nicaragua, our treaty with Great Britain in 1901, our treaty with Panama in 1903, we have presented to the world the most unequivocal quaranty of dis- interested action for the common benefit of mankind and not for our own selfish advantage. Since the canal was constructed it has been open to the ships of all nations on terms of entirelequality. The tolls charged to the commerce of all nations have been on an equal basis. The United States has sought no profit from .~s operation of the Canal and has made none. The United States investment ir, the construction and improvement of the Canal has not been fu11y mortizeu even though the Canal has been in operation for over fifty years. Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 CONFIDENTIAL A second United States objective was to have the Canal contribute to the peace and security of the Western Hemisphere. The Canal is important to hemisphere security and to the security of the United States because it shortens greatly the time required for the transit of vessels from one ocean to the other. The present Canal has served these two objectives well. At the same time it has contributed greatly to the economy of Panama. United States purchases of goods and services offset to a large extent Panama~e balance of payments deficit with the rest of the world. In 1963, Panama's gross sales of goods and services to U. S. agencies and residents of the Canal Zone amounted to over $90 million, or about one-fifth of its gross national product. Our activities in the Canal Zone! currently employabout 15, 000 Panamanians -- over three times the number of U. S. civilian employees. The fact is that the present Canal will soon be inadequate for the needs of world commerce. Within a relatively few years ships wishing to transit the Canal will have to wait in line for progressively longer periods of time. Al- ready there are some 308 ships afloat or under construction either too large AI~S_171e 7- for the Canal to accommodate or which- cannot transit the locks when fully laden. This number would be larger but for the fact that the present size of the Canal has inhibited the ship building industry from building larger and more economical ships. Our newest and most powerful aircraft carriers are unable to transit the present Canal. INSERT The American government is prepared to begin negotiations with the Panamanian government for a treaty to replace the existing one which, admittedly is obsolete in some of its provisions. Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 ? Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 CONFIDENTIAL - 3 - Furthermore, the complex locks and seaways are vulnerable to sabotage which could put the Canal out of operation for a period as long as two years -- perhaps in an emergency when we and others dependent on it most needed it. A sea level canal would be much less vulnerable to sabotage. Finally, modern construction techniques and the low operating costs of a sea level canal indicate that such an undertaking is economically feasible. The present Canal consists of a series of complicated locks and water sys- tems, which are expensive to operate and maintain. By comparison a sea level canal would be relatively simple to operate, and the number of em- plovees required to operate it would obviously be much smaller than required to operate the present Canal. Therefore, it is clear that we must start now to prepare for the construc- tion of a more modern facility in the relatively near future. Recognizing these facts, the Congress has already authorized the expendi- ture of up to $17 million dollars to study the feasibility of the construction of an interoceanic sea level canal and to determine the site which is most desirable. According to our present information, the most feasible routes from a technical. point of view would seem to be through Panama, at approximately the sit(if the present Canal or through the Sasardi-Morti route through the Darien region of Panama; through the northern aart of Colombia in the region of Rio Atrato; or through Nicaragua and possibly Costa Rica passing near Lake Nicaragua. I have issued instructions to the Secretary of State to begin discussions with all of the governments concerned to determine whether they would be interested Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 CONFIDENTIAL in our going forward with the surveys authorized by Congress. If they are, the United States is prepared to begin immediately negotiations on the terms and conditions for the construction and operation of a sea level canal. Depending on the results of these negotiations, we would expect to go forward with selected site surveys. We have in mind a treaty in which sovereignty over the canal area would remain in the country or countries through which the canal would pass. The United States would be authorized, alone or with others, to undertake construc- tion. Financing would be the primary responsibility of the United States Govern- ment but the door could be left open to contributions from other sources, both public and private. Operation of the canal could be entrusted to an international commission of composed of representatives of the Government of the United States and, the country or countries through which the canal would run and of representatives of-the users; of the groups putting tip the financing and of the Organization of American States. Thus, should it be decided by the Governments concerned to establish a multinational operating commission the operation would be inter- national rather than national or bi-national in character. This international commission would by treaty be authorized to promulgate the regulations neces- sary for the operation, maintenance and security of the canal, including the fixing of tolls. The United States and the country or countries through which the canal runs would jointly undertake the defense of the canal. 1 Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 CONFIDENTIAL 'The tollsvould be fixed in such a way as to put the canal on a self-sustain- ing basis to amortize this investment and to serve the interests of world com- merce. Like the present canal, the new interoceanic canal would be open to the vessels of all countries on the basis of equality. Whatever treaties are agreed upon would, of course, be subject to approval and ratification in accordance with the constitutional procedures of the United States and the other country or countries involved. In the case of Panama, there is this additional problem.: The Government and people of Panama attach considerable importance to modernizing the present treaty arrangements governing the operations of the Panama Canal. We appreciate this concern. We are glad to join with the Government of Panama in searching for solutions which are compatible with the dignity, responsibility and sovereignty of both nations. It is clear that we must make provision for the continued protection and operation of the Canal by the United States until it is replaced. We are prepared to negotiate a new treaty with Panama, based on the re- tention by the United States of all rights necessary to the operation and protec- tion of the Canal, including administration of the areas required for these purposes. This treaty would replace the 1903 Treaty and its amendments. It would recognize Panama's sovereignty over the Canal and would provide for a termination date for rights retained by the United States based on the operational date of a sea level canal wherever it might be constructed. The present treaties would, of course, remain in effect until a new agreement is reached. Approved For Release 2007/07/13: CIA-RDP80B01676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 In connection with the existing lock canal, our two countries have recognized the responsibilities we bear and the contributions we make toward hemispheric defense. In order that both of our nations may continue as allies and partners in the inter-American defense system and to provide for the defense and security of the hemisphere on a basis compatible with the sovereignty, dignity and in- terest of both countries, I have issued instructions for the commencement of negotiations at this time for a new defense facilities agreement to come into cha n agreement would reflect effect upon the closing of the present canal. u Es , our joint contribution toward the preservation of peace and security in the hemisphere. In summary, we foresee three principal tasks in order to satisfy the re- quirements of the present and the future: 1. Working out satisfactory arrangements for the construction and operation of a new sea level canal; 2. Providng a new treaty framework for the interim period to govern the operation, defense and administration of the present lock canal; and 3. Agreement on the terms of future arrangements for facilities for the defense of the sea level canal and the Hemisphere. It is our hope that these problems can be addressed immediately, simultaneous- ly and effectively, so that their resolution will establish our relations on a. new higher plane of understanding and cooperation in the important!task of providing an indispensable service to the world. Wherever the new canal is built it will create new opportunities. To be su:re, closing of the present Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5 / canal would cause economic problems for Panama, but these would be offset to a great extent by those new opportunities which would be created if the sea level canal were built there. Panama would benefit not only from the actual construction of such a canal but would also continue to enjoy the benefits of the present canal until the new one were completed. We are prepared to consider now with Panama a program of how best to take advantage of these opportunities and to meet these problems. The efficient employment of Panamanian workers employed in the present canal whose services would not be needed in the operation and maintenance of the sea level canal will form a major topic of our discussions with Panama We will also take every possible step to protect the employment rights Lr:, hJ~ f li i /ti'1 Z4 1 fr\ and economic security during the transition perioof~the United States citizens now employed in connection with the operation, maintenance, and defense of the present Canal. We shall do what is necessary to find them employment fitting their skills and experience and by providing retraining where this is called for. Let me emphasize that while the replacement of the present canal will present problems, these are not problems of despair, but rather, of how best to take advantage of the opportunities presented. To meet the urgent and im- portant needs of world commerce and the security of the hemisphere will re- quire the imagination and resourcefulness of all of us working together for this great common goal. We must look boldly and confidently to the future, not to the past. Approved For Release 2007/07/13: CIA-RDP80BO1676R000400160026-5