US president-elect Donald Trump clearly does not intend to pursue a “good neighbor” policy. He has been mocking Canadian Prime Minister Justin Trudeau by calling him “governor” while proclaiming that a country of 40 million people should become the 51st US state. His first telephone conversation with Mexico’s new president, Claudia Scheinbaum, had to be followed by Scheinbaum politely saying that she had agreed to none of the terms Trump claimed that she had.
Trump is seeking to reopen a debate over control of the Panama Canal that was settled five decades ago. However, in this case, Trump’s statements resonate with a powerful sentiment that long underpinned previous US policy on the issue. After all, the Panama Canal was an US idea, the brainchild of then-US president Teddy Roosevelt at the start of the twentieth century — and the US has had difficulty letting go of it ever since.
Some 5 percent of all world trade in goods, and 40 percent of US container traffic, passes through the Panama Canal. Connecting the Atlantic and Pacific oceans via a 51-mile (82-kilometer) waterway across the Isthmus of Panama, the canal has become entangled in the intensifying geopolitical and geoeconomic rivalry between the US and China. Trump’s statements about the US retaking the canal in the face of alleged increased Chinese influence in Panama have shocked many — not least Panamanians, who see them as an affront to their sovereignty.
However, sovereignty has been a pliable concept throughout Panama’s history. Contending with the vestiges of the Spanish empire in the Americas, Roosevelt thought it crucial to establish a route for US trade between the Atlantic and the Pacific that avoided the need to circumnavigate South America. There were two options: Nicaragua and Colombia. The latter proved easier but involved some US sleight of hand.
Roosevelt’s administration backed a faction that pursued secession from Colombia, which led to the creation of the new state of Panama, where the US could pursue Roosevelt’s pet project. In 1903, the US received authority to build a canal and control of the Panama Canal Zone “in perpetuity,” in exchange for annual payments to Panama.
More than a strategic trade route was at stake in seizing Panama and building the canal. In a letter to Sir George Otto Trevelyan, Roosevelt wrote: “Wherever I could establish a precedent for strength in the executive, as I did in … taking Panama … I have felt not merely that my action was right in itself, but that in showing the strength of, or in giving strength to the executive, I was establishing a precedent of value.”
In his memoirs, Roosevelt conceded his “regret” for using force in violating Colombia’s sovereignty, but the US never issued a formal apology or offered compensation. The 1914 version of the Thomson-Urrutia Treaty between the US and Colombia conveyed the US side’s “sincere regret that anything should have occurred to interrupt or to mar relations” with Colombia. However, Roosevelt’s continued opposition to such official statements, bolstered by US officials such as secretary of state John Hay (who supported the former president’s actions in Panama), delayed the treaty’s ratification. Only in 1921, when the offending passage was removed, did the US Senate ratify the treaty, which offered reparations but no apology or explicit admission of wrongdoing.
Tensions over the Canal Zone continued to simmer for decades. By the 1960s, growing resentment of US power in Latin America culminated in Panama’s brief suspension of diplomatic relations in 1964.
From that time on, the issue preoccupied more than one US administration. In 1964, after consulting with former US presidents Harry Truman and Dwight Eisenhower, then-US president Lyndon Johnson committed to work toward a new arrangement with Panama. It would take 14 years of bipartisan negotiation under two Democratic presidents and two Republican presidents before an agreement was reached. Ultimately, it was then-US president Jimmy Carter who decided that it was time to turn over the canal to Panama and correct injustices toward the region. In a nationally televised address, Carter told Americans that:
“The most important reason — the only reason — to ratify the treaties is that they are in the highest national interest of the United States and will strengthen our position in the world. Our security interests will be stronger. Our trade opportunities will be improved. We will demonstrate that as a large and powerful country, we are able to deal fairly and honorably with a proud but smaller sovereign nation.”
Even with Carter pushing for ratification, it would take months of effort to overcome opposition among the US public and in the US Congress. Finally, in 1977, the US reached an agreement with Panamanian General Omar Torrijos to transfer control of the waterway.
However, there was some important fine print. One of the two treaties that the countries signed specified that the US remained in control of the canal’s security and could use military force to defend it against any threat to neutrality. In fact, the US retained the right to defend the canal forever. The treaties provided that the Canal Zone would be turned over to Panama in 1979, and transfer of the operation of the canal would be complete by 1999. A year later, the US Senate ratified the Torrijos-Carter Treaties by a narrow margin, and the US continued to operate the canal until December 1999.
Seen in the light of this history, Trump’s recent statements might be shocking, but they are not surprising. As Trump contemplates his next move on the Panama Canal, the question we should be asking is whether the US ever became truly reconciled to giving it up.
Ruti Teitel is professor of comparative law at New York Law School and the author of the forthcoming book Presidential Visions of Transitional Justice (Oxford University Press, 2025).
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