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Additional material submitted-Continued
Hansen, Hon. George-Continued

Excerpt from Congressional Record: “Protect U.S. Taxpayers and

Consumers-Stop the Payaway"
Excerpt from Congressional Record of May 21, 1979: “A Lake of Fire

and Brimstone?-Panama Gun Running in the Caribbean"
Hubbard, Hon. Carroll: Subpena of Armando Selva
Murphy, Hon. John M:

Article of May 4, 1979 from Critica: “Hugo Asking for Reinforcement"..
Article of May 29, 1979: “Nicaraguan Solidarity Committee Selling

War Bonds”

Article: "Sandinist Brigade Members Asked to Report to Center" Pallais, Hon. Louis: Final report of the group of military advisers of the

investigating Committee of the Council of the Organization acting provi

sionally as organ of consultation... State Department:

Applications for arms shipment disposition
Application/License for permanent export of unclassified implements

of war and related unclassified technical data
Manuel Pineiro
Non-Intervention Provision
Panamanian Committee for Human Rights
Panamanian Consul
Panamanian Consul purchase of ammunition and guns
People's Solidarity Movement.
Response of committee requested list of actions constituting a violation

of the principle of non-intervention
Sandinista movement
Statement about Cuba, Panama, and guns to Sandinistas.

Tri-Continental Conference.
Sumner, Lt. Gen. Gordon, Jr.: Biography.....
Treasury Department:

Court Indictment: United States of America v. Jose A. Pujol, Carlos

9 197 207 199 206 213 197

242 198 246 196 123

Wittgreen, Walter McComas, James Howell, and Jose Antonio

Alvarez..

List of 100.30 Caliber Universal, carbine rifles sold to Jose Alvarez Communications submitted

Aldrich, George H.: Memorandum of October 25, 1974, on intervention in

the internal affairs of other states...... Murphy, Hon. John M.: Letter of January 31, 1977, to the President

105 98

242 208

PANAMA GUNRUNNING

WEDNESDAY, JUNE 6, 1979

HOUSE OF REPRESENTATIVES,
COMMITTEE ON MERCHANT MARINE AND FISHERIES,
SUBCOMMITTEE ON PANAMA CANAL,

Washington, D.C. The subcommittee met, pursuant to notice, at 10:17 a.m., in room 1334, Longworth House Office Building, Hon. Carroll Hubbard, Jr., chairman of the subcommittee, presiding.

Present: Representatives Hubbard, Biaggi, Anderson, Bowen, Oberstar, Hughes, Bonior, Lowry, McCloskey, Bauman, Davis, Carney, and Evans of the Virgin Islands.

Also present: Representatives Lagomarsino and Hansen.

Staff present: Carl Perian, chief of staff; Larry O'Brien, chief counsel; Penny Perian, administrator; Terry Modglin, professional staff; Jack Sands, minority chief counsel; Kai Midboe, minority counsel; Susan Baffa, press secretary; Jean Fling, secretary to chief of staff; Marty McLaughlin, press assistant; Taddy McAllister, clerk; Molly Dominick, secretary; Michael Smith, staff; and Ken Fendley, staff.

Mr. HUBBARD. The Panama Canal Subcommittee of the Merchant Marine and Fisheries Committee will now come to order.

The chairman has been on the House floor asking the Speaker and the House for unanimous consent that we meet today. Under the 5-minute rule, under which the House is now proceeding, we need unanimous consent permission that we be allowed to meet while the House is proceeding. That permission was granted.

Fellow committee members, distinguished witnesses, and visitors, we are convening these hearings, less than 3 months after the completion of hearings on implementing legislation, to give overview to a set of concerns that have emerged in clearer focus. Consonant with the spirit of collegiality in our committee, we are here at the written request of the Honorable Robert Bauman, ranking minority member of the Panama Canal Subcommittee.

As chairman, I am prepared to let the evidence from important sources speak for itself. Witnesses from the nations affected by the matter at hand have been invited to be heard. Congressional colleagues and officers of the executive branch will also disclose information they have gathered from long and careful investigation.

Now to the issue.

During the past several weeks, there has been exposure of a number of incidents of gun smuggling along the Gulf of Mexico from Texas to Florida. In each episode, the Panamanian Government was involved with the purchase and shipment of arms des

(1)

tined for the use of revolutionaries in Latin America. At this time, the problem appears to hold principal residence in Nicaragua.

We have learned that in Miami, Fla., an erstwhile consul for Panama is a key factor for this gunrunning. We think it is important to probe and establish the source and extent of financing of this illicit traffic in weaponry.

Of great concern to this committee is the threat such behavior holds to the uninterrupted operation of the canal which is essential to shipping by world transporters. We are committed in every instrument drawn and signed by our respective governments to a course of protecting the canal.

If Panama is, in fact, providing arms to Central American revolutionaries, they are urging upon themselves possible retaliation and upon us, a party to the treaty, they are bringing additional military concern.

We are further concerned about the possible political embarrassment that these alleged incidents of gunrunning hold for us as a party to the new treaties. We were promised by our President, Jimmy Carter, that these treaties would usher in a new era of peace and understanding in Latin America. We cannot tolerate light regard of treaty terms that are so costly to the American people.

Another question that some of my colleagues have raised is what will come of additional revenues that the Panama Canal will produce? Will these funds underwrite the cost of continuing revolution in Latin America?

The 2 days of hearings will deal with these and other issues that have had a late onset before final consideration of implementing legislation. We will hear the evidence of those who have been called to testify to determine the gravity of these problems which, I am told, have been known to responsible people in our Government for some time now.

One important caveat is in order. The subcommittee is aware of the pendency of criminal actions in two Federal Courts arising from the weapons transactions at issue. Those cases will not be tried in these proceedings. On the contrary, I exhort my colleagues to appreciate the sensitivity of these matters and, at the same time, recognize that official witnesses may circumscribe their testimony so as to protect individual rights and the Government's case in chief.

At this time, before I read the statement of the distinguished Chairman of the full Merchant Marine and Fisheries Committee, I would call on Robert Bauman, the ranking minority member of the Panama Canal Subcommittee, for any statement he may wish to make.

Mr. BAUMAN. Thank you, Mr. Chairman.

I want to also thank you for responding to the request made by myself and others to hold this hearing. I think it is totally consistent with the mission of this subcommittee and its role in writing the implementing legislation for the Panama Canal Treaty to consider the problems presented by the events that you have described in your statement and that will be the subject of testimony in the next 2 days. I think that these developments are more than disturbing. They may have direct impact upon the legislation that we

will be considering next week on the floor of the House. The schedule has been changed for that consideration a number of times due to political factors.

We do indeed have to address the question of whether or not these treaties take effect on October 1, but the income that will accrue to the Government of Panama will be added to the subject of these hearings. A great deal of money will be paid to Panama under the treaty terms, and I suspect that we will find evidence in these hearings that already Government involvement on the part of Panama may have diverted funds for this purpose. And that is certainly an issue of great concern and indeed you are quite correct in raising the issue of the U.S. military involvement under the neutrality treaty which is not the subject of implementing legislation but which is self-executing.

The United States acquires a great many obligations to defend the neutrality of the Panama Canal and to insure its continued operation. If indeed the facts that have been reported in the press and the subject of testimony are true, the Government of Panama certainly is inviting retaliation from other governments and could thereby involve the United States in obligations under that neutrality treaty as well as obligations under the treaty which we will be implementing in our legislation.

It is my own view that these hearings will probably produce evidence that officials of the Government of Panama are engaged in violations of the U.N. charter, and most certainly in violation of the charter of the Organization of American States, because they are, in fact, engaged in intervention in the affairs of another nation. They are engaged apparently in supporting gunrunning and in the importation of arms, some examples of which we see in the committee room today.

The central question that we should concentrate upon, in my view, is not the threat to the existence of the Nicaraguan Government, although that is a legitimate concern since it is a properly constituted government, but rather to find in our mission as the Panama Canal Subcommittee what regulations the implementation may require, what further dynamic restrictions may be written into that law, and whether or not the Government of Panama is not already in violation of the treaty that we signed with them in 1977. Those are the questions that I would like to engage in today and tomorrow.

I thank the chairman for his indulgence.
Mr. HUBBARD. Thank you very much, Congressman Bauman.

We will proceed another 5, 6, or 7 minutes before we have to go to the floor for a vote, and then we will come right back and proceed immediately.

Repeating the reason why we are a few minutes late today there was the necessity of having unanimous consent that we meet in fact today while the House is in session under the 5-minute rule.

I would say, as chairman of the subcommittee, that is, as one who has been opposed to the Panama Canal Treaty from the outset, that it is very possible that during these 2 days of hearings, the people of this subcommittee and the full committee and, in fact, perhaps the entire Nation, will realize that it is very possible that those millions of Americans who were very, very much opposed to the Panama Canal Treaty were wise in their judgment. Kentuckians, such as those that I represent, who were 90-percent opposed to the Panama Canal Treaties, were told that we were illinformed and not fully advised. It could be that these millions of Americans who opposed these treaties from the outset may be proved to be correct.

Chairman Murphy is out of the country on official business but let me please read his statement, which is brief, at this time.

This is the statement of the Honorable John Murphy, chairman of the Committee on Merchant Marines and Fisheries.

In recent weeks, there have been a number of incidents of gun smuggling at points on the Gulf of Mexico from Florida to Texas. The object of the smuggling has been to supply the means for the Sandinista Liberation Front, which is seeking the violent overthrow of the duly elected Government of Nicaragua, to accomplish just that. I will repeat that sentence from Chairman Murphy. The object of the smuggling has been to supply the means for the Sandinista Liberation Front, which is seeking the violent overthrow of the duly elected Government of Nicaragua, to accomplish just that. There is no question that the Communist Government of Cuba and its Communist surrogates in Panama and Venezuela are involved in this gun smuggling.

The gravity of this matter is apparent to all. First, it is a threat to the peace and stability of Central America. The United States cannot and should not tolerate the use of armed force to subvert Nicaragua's constitutional processes for electoral change. Violence will only breed further violence and lead to instability and chaos in the Caribbean.

Second, this matter raises a serious question about the future intentions of the Panamanian Government in Central America. Does Panama respect the constitutional processes of its neighbors? Does it endorse the principle of peaceful change?

Until now, the public evidence of gun smuggling to the Sandinista National Liberation Front has been scattered-media reports and the like. There have been random indictments of Panamanian nationals by the Federal Government. And there have been, of necessity, only fragmentary news stories. The purpose of this hearing today and tomorrow is to collect all the evidence so that it may be intelligently assessed by the Members of Congress, who are now involved in enacting legislation to implement the Panama Canal treaties, and by the press, which is charged with informing the American public, and, ultimately, by the public itself.

The purpose of this hearing is neither to delay nor to derail the Panama Canal Treaty implementing legislation. And I will repeat that. The purpose of this hearing is neither to delay nor to derail the Panama Canal Treaty implementing legislation. I remain committed to the concept that the Congress must now enact legislation that will honor our Nation's execution of the Panama Canal Treaty, insure the efficient and neutral management of the canal in the years ahead, insure the future protection of the canal, and deal fairly with the many Americans who have devoted their careers to the operation of the canal or the management of the Canal Zone.

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