IS PANAMA RUN BY A MILITARY 'MAFIA'?

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000302620009-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: July 20, 2010
• Sequence Number: 9
• Publication Date: July 7, 1986
• Content Type: OPEN SOURCE

STAT
Drug king? Spy? Not I, says General Noriega
Is Panama run by
a military 'Mafia'?
Panama
^ While Ronald Reagan was busy win-
ning aid for Nicaraguan rebels from
Congress, alarms began ringing over
Panama and the canal that makes it a
key strategic concern of the U.S.
Together, the canal and U.S. military
bases here mean the American stake in
Panama is greater than in all the rest of
Central America combined. Indeed,
anxiety about canal security is part of
the reason for U.S. concern about
Marxist control of Nicaragua. Yet
many things about Panama are turning
sour at once.
Panama's de facto ruler, military
strong man Gen. Manuel Noriega, is
accused of drug trafficking and laun-
dering of drug money, arms smuggling
and spying for Cuba. These charges
have followed those alleging more-
common regional sins such as election
rigging and political intimi-
dation. The country's fifth
President in as many years,
Eric Arturo Delvalle, is
widely regarded as little
more than a complaisant
front man for Noriega. Un-
employment, inequality,
economic stagnation and
huge foreign debts are cre-
ating what one U.S. diplo-
mat warns is a "time bomb
waiting to go off."
In Washington, demands
are growing that Reagan
"do something" about Pan-
ama-especially about
Noriega-though no one
seems certain exactly what.
Behind the agitation is con-
cans, all this rekindled
doubts about the kind of
government that is taking
over the canal. That, White
House aides complain, is
precisely the goal of conser-
vative officials and lawmak-
ers who seek to advance
their "different agenda" by
reviving charges that go
back to the early 1970s.
Whatever their agenda, a
number of U.S. policymak-
ers are worried about hand-
ing canal operations over to
a poverty-stricken, politi-
cally unstable nation. Skep-
tics fear that Panama's mil-
itary chiefs are mainly
interested in o eratin a
Senator Helms claims
Norlega is corrupt
cern that popular resentment in Pana- Mafia-style racketeering network to en-
ma could fuel the same kinds of leftist rich themselves and their friends. By
upheaval that brought Fidel Castro to that assessment, the huge cash flow
power in Cuba and the Sandinistas to generated by the canal might prove an
power in Nicaragua. irresistible temptation without major
If prolonged, the furor could revive reform of Panama's endemic corrup-
the tensions that were supposed to dis- tion and cronyism.
appear under treaties transferring con- "We want to turn the canal over to a
trol of the canal to Panama by the year viable, stable democracy, not a bunch
2000. For seven years, the transition of corrupt drug runners," fumes Jim
moved calmly. A respected pro-U. Lucier, a key aide to Senator Jesse
economist, Nicolas Ardito Barlett Helms (R-N.C.). Helms has been a
was elected President of Panama i leading critic of Noriega and the canal
1984. Though there were strong suspi- treaties. "There's tremendous congres-
cions that Noriega had stolen the elec- sional concern, particularly about Gen-
eral Noriega," adds Representative
Mike Lowry (D-Wash.), whose Mer-
chant Marine subcommittee plans
hearings on the canal later this sum-
mer. If narcotics charges against Pana-
manian military chiefs are proven. says
Lowry, "we'd be talking about with-
holding dollars from one of our long-
time friends. Congress is pretty serious
about drugs."
Noriega seems unworried by the
headlines and hot words. In an inter-
view with US.News & World Report, he
brushed aside suggestions that the Rea-
gan administration may be turning
against him. "It doesn't suit President
Reagan's strategic plan," he said confi-
dently. "Panama must remain a positive
partner, acting in favor of American
interests and not in confrontations."
The general dismisses critical reports in
the U.S. press as the product of a con-
spiracy among "bad Panamanians" and
"ultra-rightist forces" in Washington
who hope to overturn the treaties.
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RTICLE APPEARED U.S. NEWS & WORLD REPORT
7 T?1.. 10RA
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tion for Barletta, the preceding cam-
paign was unusual in that los gringos
and American control of the canal were
not bitter issues. Panama's military
chiefs, including Noriega, appeared to
be withdrawing slowly from domina-
tion of politics and the economy.
Serious trouble began last September
when Barletta was forced to resign. He
apparently had pushed too hard for an
investigation into the brutal murder of
Dr. Hugo Spadafora, a colorful politi-
cal activist and persistent critic of Nor-
iega's rule. Spadafora was last seen
alive in the custody of troops from the
Panama Defense Force, as the nation's
military, which Noriega commands, is
officially called.
Then came the recent series of re-
ports-clearly leaked by high-level
Washington sources-about the gener-
al's alleged misdeeds. For many Ameri-
STAT
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Panama
TA Canal
ONE REASON THE CANAL
WORRIES SO MANY
The battleship U.S.S. New Jersey
passes through the Gatun Locks of
the Panama Canal, with a cruise ship
in the background. Quick passage for
Navy vessels between the Atlantic
and the Pacific, avoiding the long trip
around South America, is a principal
concern of the United
States, as the slow transi-
tion to full Panamanian
control of the canal contin-
ues. The treaties under
which the U.S. agreed to
give up most of its rights
were hotly argued and re-
main among the most con-
troversial acts of the Carter
administration.
However, Panamanian military
sources say that privately the general is
angry about the stories. He re orn tedly
is furious most of all about what he sees
as "betrayal" by the U.S. Central Intel-
ligence Agency, with which he has had
close ties for many years.
There are strong practical and politi-
cal reasons for Noriega's confidence.
Foreign diplomats and local analysts
believe that he eventually will be dam-
aged by the steadily mounting accusa-
tions. With time, he might have to step
aside-especially if a less controversial
replacement can be found-to maintain
U.S. aid that this year totals $31.2 mil-
lion. But for now there is no serious
threat to his authority.
Political opposition forces are badly
divided and poorly organized, lacking
ties to influential labor and student
groups. Panamanian citizens are highly
reluctant to take to the streets to force
change, as happened in Haiti and the
Philippines.
A recent opposition rally
drew only a few hundred pro-
testers. This is partly because
of fear of repression. Butt here
is a more important deterrent:
The military-run regime pro-
vides one fourth of all jobs,
and government critics risk
losing their paychecks.
By most estimates, Wash-
ington will remain commit-
ted to the security of the 50-
mile-long "big ditch."
Primary U.S. responsibility
for canal security expires in
1999. But any American
President almost certainly
would use force to thwart a
real threat under treaty
terms guaranteeing perma-
nent neutrality of the canal.
The official position in
Washington is to condemn
strongly the offenses Noriega
is accused of committing, es-
pecially drug running. But ad-
ministration spokesmen insist
that all reports they have so
far about his involvement-
although admittedly volumi-
nous-are "hearsay, circum-
stantial or speculative."
For obvious political rea-
sons, Washington does not
want to chastise authoritar-
ianism in Panama while por-
traying Nicaragua as the
only nondemocratic regime
in the region. Finally, there
is no official enthusiasm for
what many see as a no-win
contest with an opponent
who can hit back painfully.
Washington could easily halt U.S.
training of Panama's armed forces, for
example. But Noriega could just as eas-
ily end or reduce his country's role as
home of the biggest, most important
U.S. military outpost in all Latin
America. More than 9,000 American
troops are stationed in Panama, which
is headquarters for the Army's South-
ern Command. SouthCom's security
responsibilities stretch from Mexico's
southern border to the tip of Chile.
U.S. base rights in Panama run out at
the end of 1999, but they could be
extended if relations between the two
nations remain reasonably warm.
Administration strategy apparently
calls for waiting to see if the furor sub-
sides. It may. But even if the alarm
bells now ringing fall silent for a while,
they could ring again more loudly as
the year 2000 draws nearer. ^
by Carla Anne Robbins with
Washington bureau reports
THE 'BIG DITCH'
Politics aboll,
waters calm
Seven years into .the treaties of
transition for the Panama Ca-
nal, little has changed for the
30-odd ships that navigate the
strategic waterway every day.
It is still early in the gradual
process by which the U.S. is
turning the 70-year-old, 50-mile
canal over to Panama. By the
year 2000, the U.S. is commit-
ted to yield the last vestige of
administration. For now, transi-
tion and traffic run smoothly.
Through a binational Panama
Canal Commission, the two na-
tions share responsibility for
what once was called the "big
ditch" linking the oceans. Busi-
ness has rarely been better. An
oil pipeline parallel to the canal
has cut the traffic of tankers. But
expansion of world trade gener-
ally has meant an increase in
overall tonnage. In the past eight
months, some 124 million tons
of goods went through the locks
in 8,100 ships-an increase of
more than 10 percent over the
same period a year earlier. In
fiscal 1985, 68 percent of the
cargo moved either to or from
the U.S., including 13.4 percent
of all U.S. seaborne trade.
Already, more than 80 per-
cent of the 8,000 canal em-
ployes are Panamanian. Some
1,300 Americans still perform
key tasks, such as piloting ships
through locks so narrow that
minor errors in navigation can
result in major damage to ves-
sels or to the canal itself. In
time, Panamanians also will
take over most of those jobs.
The next stage comes in 1990,
when a Panamanian is to become
head of the commission. Dennis
McAuliffe, the American now in
charge, says he is confident Pan-
amanians can do the job. But
many experts worry that Pana-
ma's planning for the takeover is
lagging. They worry also that
historic Panamanian cronyism
will prevail, dumping trained
personnel in favor of political
friends, a fate that already has
befallen the country's ports and
railroad, which have been taken
over from the U.S.
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