Sorry for the recent O.T. posts lately but i thought it would be of some interest........

Date: 7/28/99 Author: Brian Mitchell The U.S. Department of Energy calls it a ''major transit center for oil shipments and a potential choke point.''

At year's end, the transit center and choke point will slip from U.S. control into the hands of a Hong Kong company with close ties to the Chinese government and military.

The surrender of the Panama Canal has been scheduled for years, since the Senate approved the Carter-Torrijos Treaties in 1978. But U.S. officials are only now coming to terms with what the pullout will mean.

Giving up the canal has already forced the U.S. to dismantle the busy nerve center of its counter-drug operations in the region. And no one imagined in 1978 that the vacuum created by the U.S.'s departure would be filled by the Chinese.

''I thought it would be the Russians, with their interests in Cuba at the time, but it turned out to be the Chinese,'' said retired Adm. Thomas Moorer, former chairman of the Joint Chiefs of Staff.

Moorer has made the canal a personal cause in recent years. Last year he testified before the Senate Foreign Relations Committee, urging lawmakers to keep the canal.

In an interview, Moorer said: ''I don't see how any reasonably intelligent person can fail to see the vital strategic importance of that canal. The Chinese see it, obviously.''

Just 10 years ago, the U.S. used military force to defend its interests in Panama. The U.S. has had as many as 10,000 troops stationed in Panama. It now has just 500 to help close up. All will be gone by Dec. 31.

The U.S. has abandoned most facilities already. The biggest problem now for the Panamanians is what to do with all the vacant real estate. The maintenance bill alone runs $40 million a year.

''If (the facilities) are not maintained in five years, they'll be of interest only to archeologists,'' said Ambler Moss, U.S. ambassador to Panama from 1978 to 1982 and current member of the Panama Canal Consultative Committee, a presidential advisory board.

Moss was a key member of the canal treaty negotiating team in the 1970s. He is now director of the North-South Center at the University of Miami.

''The important thing (for the U.S.) is the ability to use the canal, not the right to run it,'' Moss said. ''The Panamanians are certainly ready to run the canal. They've been running some of the top management positions for some time.''

More than 15% of goods entering or leaving the U.S. pass through the canal, including 40% of U.S. grain exports. Oil and oil products account for as much as 17% of canal shipments. About 670,000 barrels per day of oil and oil products passed through the canal in 1996.

Canal traffic and revenue have risen slightly in recent years, but economically the Panama Canal has never been less valuable. It can't take supertankers or any vessels over 100,000 tons. And in the U.S. at least, freight rates for both rail and air are becoming increasingly competitive.

''The canal is not as important a facility as it once was,'' said Mark Falcoff, resident scholar at the American Enterprise Institute and author of ''Panama's Canal: What Happens When the United States Gives a Small Country What It Wants'' (American Enterprise Institute Press, 1998).

''If the canal closed tomorrow, it would be an inconvenience, but not a disaster,'' Falcoff said.

But Panama was important to the U.S. for other reasons.

The multinational counter-drug force in Panama used Howard Air Force Base to stage 2,000 counter-drug flights per year. It used Rodman Naval Station for pierside boarding, boat searches and boat maintenance. It used Fort Sherman for jungle training.

Alternative landing fields in Ecuador and Curacao have not worked as well, and the lack of naval facilities on the Pacific coast of Central America has hampered coverage of a major route for drug smuggling.

''We don't have the coverage now on the western side of Central America,'' said Pancho Kenney, director of strategic planning for U.S. drug czar Barry McCaffrey. ''I don't think you can come up with any other conclusion than that we've got a problem that we've got to face up to.''

Moorer says the canal is still needed by the U.S. Navy to shift warships from ocean to ocean. The canal can't take aircraft carriers, but it can take any other warship. In any major conflict, the Navy would have to move dozens of logistical supply ships through the canal.

''If the United States doesn't have control of the canal if we got into a war, the first thing we'd have to do is go down there and take it,'' Moorer said.

Panama's Neutrality Treaty with the U.S. guarantees the U.S. continued use of the canal. It also commits the U.S. to Panama's defense and gives the U.S. the right to intervene militarily to keep the canal open.

Moorer says Panama has already violated the Neutrality Treaty through its relationship with Hong Kong-based Hutchison Whampoa Ltd.

In 1997, Panama awarded Panama Ports Co., an affiliate of Hutchison Whampoa, a 25-year concession to operate two major ports at opposite ends of the canal: Balboa at the Pacific end and Cristobal at the Atlantic end.

The award was disputed by American and Japanese companies, which claimed to have outbid Panama Ports. The U.S. embassy filed a protest, amid allegations of bribery.

Nevertheless, Panama's legislature in 1997 enacted Law No. 5, giving Panama Ports broad rights over port facilities at Balboa and Cristobal.

Those rights also include control over the hiring of new canal pilots, effective control over shipping in and out of the canal, control of access roads along the canal, and the right to transfer ''contract rights'' to third parties.

Hutchison Whampoa owns 72% of Panama Ports. China Resources Enterprise owns 10%, according to a report by the Senate Government Affairs Committee, chaired by Sen. Fred Thompson, R-Tenn.

China Resources is a commercial venture of China's Ministry of Trade and Economic Cooperation. The Thompson committee calls it a venture in ''espionage - economic, political and military - for China.''

Hutchison Whampoa itself has other ties to China. Its Hutchison International Terminals subsidiary has teamed with China Ocean Shipping Company, a major player in China's international arms trade, owned by China's People's Liberation Army.

Hutchison Whampoa is controlled by Hong Kong magnate Li Ka Shing, who is heavily invested in China and has worked as a middleman for Chinese dealings overseas.

''Li Ka Shing is very close with the Chinese Communist Party,'' said Al Santoli, national security adviser to Rep. Dana Rohrabacher, R-Calif., and editor of the China Reform Monitor, published by the American Foreign Policy Council.

Santoli traveled recently to Panama to investigate the growing Chinese presence. He reports ''massive illegal immigration'' into Panama from China, facilitated by Chinese gangs aboard commercial vessels.

''The Chinese are very aggressively moving into our hemisphere,'' Santoli said. ''They've stepped up their cooperation with Cuba. . . . People are just starting to realize what is happening.''

It's too late, Falcoff says.

''We ought to let Panama have a few years of living alone without us,'' he said. ''The Panamanians are going to discover that the price of independence is very high. They will try to lure us back one way or another, but it's hard to picture us ever going back the way that we were before.''

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-- kevin (innxxs@yahoo.com), July 28, 1999

Answers

It's not Y2K compliant anyway- let em have it.......

-- farmer (hillsidefarm@drbs.net), July 28, 1999.

Clinton also leased the Long Beach Naval Shipyard to Chinese Interests and as I recall the local officials were not at all happy about that. Perhaps the President can invoke the Monroe Doctrine again. That is M O N R O E. We can defend against foreign interests etc. What is to prevent the local officials from stealing the income from the canal and deferring critical maintenance? Watch the foreign aid to the canal within a couple of years.

-- Phil (Phil@bb.wow), July 28, 1999.

The Monroe Doctrine died during the Cubam missile crisis.

-- Mad Monk (madmonk@hawaiian.net), July 28, 1999.

Just another trigger mechanism on the global powderkeg.

This one however sits on our wallets and trade venues.

Interesting.

-- INVAR (gundark@sw.net), July 28, 1999.

Been listening to a shortwave program on 5.085 tonight. It is a discussion about the Nafta Railroad which will run from Panama through Mexico up to Canada. Very interesting.See: www.amerikanexpose.com for more info on Nafta Corridor and parallel railroad.

-- Betty Alice (Barn266@aol.com), July 29, 1999.