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PANAMA CANAL ISSUE FLARES ANEW
WILLITBE•••
20%INFLATION?
Test of US. Resolve SayOpponents of New Treaty
OR 20%INTEREST RATES?
lf
thc
Unitcd States Senate g.ives
direct and indirect. Panamanians
the green ligJn, a State Oepartment enjoy the highest per eapita income
enginecred treaty will give the Pan· in latjn America. Tbe canal ac-
amanian govemment etrective con- counts for a full third of t.he tiny
uol ovcr tbe st.ratcgic Panama nation•s gross national product.
Canal.
and forty pereent of its fore ign ex·
Under the proposed treaty, as ex- change.
lt
is felt by many impartía!
plained to the Senate Foreign Re· observers that Panama's total ea-
lations subcommiuee on Februaty nal-derivcd income would go down
28 by a high State Oepartment offi· rather than up should U.S. man-
eial, Panama would "accept" a agemcnt of thc waterway
ce~.
continued United States mHitary
For the United States, the canal
presencc in tl1e Canal Zone for an still performs a valuablc .service for
unspec::ified lcngtb of time in retum commetce aod industry. Even in
for ''prompt" termínation of Amer- the age of the supertankers., wbich
ican sovereig.nty over tbe 500
4
eannot ncgotiate the cana.l's restric-
square-mile zone. Aewal manage- tive lod: systems, 15,000 ships
ment or the waterway itself would course throug.h the. 50--mile ocean.
remain with thc Unitcd States, but link e\'ery year. Scvcnty pcrcent of
there wouJd
be
an increasing Pan- thesc vessels .sail from or are des-
amanian pres.ence
in
the manage- tined for American pons.
mcnt.
.
Proponents of the treal)' claim
E:lt.pens:ive Purc.hase
the time is
ripc
for lhe United
The Unitcd States purc.hased
States
tO ..
modemiz.e·~
hs
relation- sovcreign
rigbts
in the tone
'"in
ship with Panama. Opponcnts -
perpetuity" from the new Republic
including, it is be!ieved; presently of Panama for $10 million
in
1903.
eoough members of tbe Senate to The sum sounds stnall by today's
block a new pact - claim any sub-- standards but it was more than was
stantiaJ change in relationship be- pa.id for cither Alas.tca or Florida.
twee-o the two á:>Untries is totally
Total Ame.rican investmeht ín
unnccessary and that any attempt the Canal Zone, includuig its de-
to opcrate and defend the canal fense. comes close to
$6
biUion.
_ __._w!!:11.·
!ll'.l!W!thg!e~~;,!!o~f'ªa!libso~u¡¡te~~v~--~L¡:!e;z~!.he ~rt~l_!!!.l!..!~~5¡!)\ij~
ereign_y ng éan only meet witb wt e stnp ofTana oo ••ther side
ot
disaster, given the historie instabil- it is as much a part of the U.S. as
ity of Panamanian politics. Tbey any of the tifty states.
As
one
concede tbere is room for furtber American living in the zone put it,
adjustment of the original 19()3
"Giving the Canal Zone to tbe
treaty - already done twiee before Panamanians will be Uke giving
in 1936and agilin in
l9SS -
but the Florida back to the Spani$b."
key
~uc
ofsovereighty must never
Stratcgically. the Panama Canal
be oompromised.
forms pan of the ooastline of the
"In
my judgment." says U.S. United States. Calling the canal the
Senator Strom Thurmond...it. is a
·~ugular
vein of lbe Amcricas;·
semantic
triclc
to mainrain that lhe Democratic congressman Daniel
U.S. can keep oonlfol of the Canal Flood, ' the eanal's most eloquent
and the capability to defend it if defender. compares
its
value to that
e~er
we ..
si
ve
u~
our sovereig.n
of the Chesapeake Bay or the Mis·
ogbtS.
. . .
sissippi River.
E•eryone Has Benclitted
Ashamed of Powcr
Wbat
is
certain
is
thar lbe canal
The negotiations over thc eanal's
has been good to Panama, througb futute status are especially inter·
whieb
it
slices., as weU as to t.he esting in
Jight
of lbe overall decline
United States - not to say tbc e-o- of American power.
tire free-world eeonomy.
The canal issue dredges up aU
As a result of canal opcrat'ions. the usual fe-elings of self·guiJt in
,.,_
rNC&An
WEEK ENDINO APR!L
5,
1975
the hearts of American tiberals
who advocate
its
surrender in order
to atone for tbe sin of being the
world's mosl poweñul nation. To
them lhe lush American
Zone,
with
lts famous well-mahicured lawns
and whitc-wasbed, red-rile-roofcd
buildings - in sharp contraS! to the
drab squalor found in mucb of
neighboring Panama i tself
-
smacks too much of"colonialism.."
Counteriog this
viewpoin~
oppo–
nenl$ of the oew treaty say
it
is
(Conrinued on poge 4, CIJI.
J)
Like the unemployment figures,
the U.S. federal budget deficit
keeps getting revised upward.
Initially, the Administration
foresaw $52 billion in red ink
fo~
the next fiscal year of July 1, 1975
througb June 30, 1976. Pol.itical
realists noted that because Con–
gress would likely reject the..Presi·
deot's proposed spending cuts, the
total would be more like $70 bil–
lion. Now Arthur Burns. the august
Federal Reserve Board Chairman,.
ups the ante still furtbe r, fore·
casting a deftcit of S100 biWon.
But the figure becomes even.
Britain·to Stay in ECC?
VOTERSWILL DECIDE
The formula for Britain's oontin- United Kingdom shou1d stay in
the
ued membenhip in the Europeao Europeao Community?" 45 pereent
.Economjc Community was finally of those asked answered in the
a(.
bammered out at the E'uropean
finnative. Some 33 percent were
summit conference in Dublin agai_nst cootinued membersh.ip, 14
Castle on Mareb 10 and 11.
1t
is
peroent were
undecided
and 8 peroent
generally believed that the beads of sajd it depended oo the terms of
state of the other eight Common membership. It is now up to Mr.
Mark.et nations - eager
to
avoid Wilsonand biscabinet tostrcngthen
the disruptio n of .a Br:itisb the pro-market percentage between
Withdí'3.WaJ
.:!
went
~~rat
'Í$
t:oU.Id
·--:now
an<J Junc: But iftbe votcrsreject
reasonably
be
expectCd
in
meeting the new tenñs - which the Conti-
British renegotiation demands.
nentals cons:ider generous - and
"1
thin.k
the terms are a great
Britain tbeo departs from Europe,
improvement over wbat we havc
there is notgoing
to
be
mucb sympa·
go~"
Britain's Prime Minister Har- thy in Brussels when the Labour
old Wilson told a press oonference govemment
or
some other future
followin.g the conclusion of
thi
admioi$tration comes back to scck
summit If tbe conoessions given spccialttade conc:cssions. Once out
Britain are approved by Wilson's this time, Britain wiU bave to stay
Labour eabinet- which is virtuaUy out.
o
oena.in - the Prime Minis-ter plans
to actively campaign for their ac-
more insaoc. Political analyst
George F. Will, after toting up the
figures for new spending, borrow–
ing by olf·budget agencies (sueh as
tbe Postal Service) and from trust
funds (like Social Security), a
larger
tax
cut. and defauJts on gov·
ernment loans, projects a deft.cit of
· - hold your breath- SI3S bill.ion!
In
Ught of the fact that
$10
bil·
lion was the total amount ofrnoney
raised by
al/
borrowers last year
-
not just lhe govemment - the
statistics rcaeh a level of absurd·
ity.
The money
wiU
bave to oome
from onJy one of two places. The
govemment must either borrow it
or prlnt
it
lf lhe govemmcnt bor–
rows. oompetition for dwindling
suppties ofmoney
wiU
push up in·
teresc rates to all-time bigbs.
Sbould thi$ indeed oeeur, Normao
T~re,
a Washington cconomist,
looks for a prime rate of
10
percent
by year•s end. Such a credit
squeeze would push the eoonor:ny
into sure depression.
lf, on t.be other band, the govern·
ment prints enough money to cover
even half of tbc more pessitnistie
deficit projections-, the money
supo
ply could swell by at least twenty
percent (sorne eeonomists say thirty
percent), fueting a roughly twenty
percent iotlation rate, if not more.
·
DUring the Thir.ties! · sophis–
ticated eoonomists dleamed up the
phrase ••wc owe
it
to
ourselves~·
in
order to justify a spending spree.
IronieaUy, the American people
may indeed fiod that they owe it
10
themselves - but wb.at tbeir Con·
gress wiU b.ave bougbt with a mam·
moth increase in federal debt will
not
be
extra goodies but economic
coUapse. • o
ceptanee by the Britisb people aod
a vote for condnued British mem–
bership in the EEC in the planned
national referendum
in
June.
Tbc negotiations whicb resulted
in the improved membersrup term.s
for Britain were far from smooth.
Numerous formulas to soJve the
question of Britain's budgetary
contributions were put forward and
debated before a ftnal budget ad–
justment plan involving a yearly
S300 million refund to Britain was
aeeepted. Londoo has long oon·
tended that
it
was earrying ao uo–
fair sbare of the financia! burden of
the EEC bÚdget.
GRIM ISRAEL PUSHES FOR
SETTLEMENT DESPITE MASSACRE
The real irony of thjs summit
i.s
that even now, after 1be con–
cessions the otber eight made
to
Britain. continued British metnber–
sbip is still uncertAin. Not until af.
rer the rcSult of the nationwide
referendum in June
will
we know
wbctber Prime Minister 'wilson
gained enough ammunidon· in
Oublin to finally win the British
people over
to
the European ideal.
The June referendum could be
the mosr important single election
in aliBritain'sloog history.
According to a reoent newspaper
poli, more Britons claim they wish
their nation to reinain in rhe Com–
mon Market thao leave. In answe.r
to the question uDo you
lbink
the
JERUSALEM: "Kissinger's ef·
fort wilt fail." This motto was de–
fiantly blaz.oned in Arabic aeross
!he side of nne of tbe two dinghies
used by Palestinian Lerrorists in
tbeir Mareh
S
assault from the sea
wbieh resulted in the death of nine–
teen peroons, including 7 or the 8
terrorists, and the dcstroetion of
Tel Aviv's Savoy Hotel.
The terrorist group,
A1
Fa1ah,
claimed respoosibility for !he
OJ!"
eration.
Farah
is led by Yassir Ará–
fat and is the largest and most
powerful oomponent of the Pales–
tinian Liberation
Organíz~uion.
Obscrvers
in
Bcirut say that Arafat
personaUy gave approval for the
mission and that it was planned by
bis second-in-command, Salab
Khalaf, also kn.own asAbu lyad.
With the Savoy raid Arafat
strengthened his position- among
the members of the PLO wbo
tbought 6e had "gone soft" with
the rise of bis poütical stature
around the wodd.
Israelis
sce
this most recent actas
further confirrnation that the PLO
i.s
just a gang of murdcrers intent
on the final dissolution of the state
of Israel and tbe death of her citi·
zens.
Despite the Tel Aviv atroeity, the
lsracli govcrnmcnt has announced
its
detennination to carry on with
the next round .of Henry Kiss–
inge(s sbuttle diplomaey. On the
surface. thcrefore,
it
seems thc ter·
rorists faíled in their mission.
Cbances for a
second~stage
agrce·
ment with Egypt, the key Arab
state, remain good aocording to
most of the officiaJ opinions ex·
pressed bere.
•
'
But in any meatier discussions
about an overaU setdcment, the Sa–
voy atrocity will serve as an exda–
mation mark to the a lready well·
known lsraeli position vis-il-vis the
PLO. Arafat's latest episode wiU
only barden the altitudes of those
ts-raetis who may have begun to
oonsider including the PI..O in fu.
ture negotiations.
The most fundamental issue in
tbe endless.round of Middle East
negotiations, from ls.raers point of
view, is not territory or the forma-
(Continued on pag•
~.
col. ))