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from Miami for ultimate use against the government of Nicaragua. What made this report important was the fact the accused were allegedly acting on behalf of Panamanian Intelligence, the equivalent to our G-2.

Reinforcing our concern, we received reports originating with the Bureau of Alcohol, Tobacco and Firearms of the Department of the Treasury that smuggled arms had been intercepted in Texas, also ordered by Panamanian agents for the use of revolutionaries in overturning Central American governments.

Not trusting the accuracy of newspaper reports, my office checked with the reporter who wrote the story and followed with interviews with the Assistant United States Attorney who was seeking indictment of the Florida gun smugglers. To the degree possible, those reports have been thoroughly substantiated. Court records, names, dates and affidavits have been procured and are available to this committee for its inspection. The government of Panama is clearly involved in illegally running guns from the United States for the ultimate use against a neighboring Central American country.

Finally, as the straw which broke the camel's back, came reports that Panamanians, only recently in high government office, were recruiting and leading Panamanians against the government of Nicaragua. Worse yet, their attack has been reported to be coordinated with Cuban support which has arrived in the battle zone in Cuban Aircraft of the type used in Angola from which the Red Star had not even been removed.

If these events and allegations stood alone, they would be important and worthy of Congressional concern and scrutiny. But as we all know, they occur in a context of the single most important treaty decision in the history of the United States. I will not attempt to deceive this committee. I have been, since there was serious indication of completion of negotiations for the Panama Canal treaty, completely opposed to the divestiture of territory of the United States. None of us, in our entire careers will deal with so crucial an event. I have fought together with other members to defend the prerogative of the Congress, particularly the House, to decide when and if such territory should be disposed of.

With other members I have protested that to acquiesce in the usurpation of legislative function sets a precedent fraught with peril for the legitimate function of the Congress in foreign affairs. Finally, as must be known to everyone, I have fought to reduce or eliminate the impact of these ill-considered treaties upon taxpayers and Canal users, as had been promised by the Administration to secure Senate passage.

But even if these treaties were drafted with the greatest care to protect the interests of the United States and the safety of the commerce of the entire world, recent events would make it foolhardy to go forward with the treaties and their implementing legislation until we are completely satisfied that the export of revolution by our treaty partner does not endanger the Canal.

This is not a matter which can be resolved with a guess or a supposition. We cannot accept the assurances of the State Department. Reliance on representations from that quarter has caused much of the confusion which clouded the Senate's advice and consent. We have all

here seen the reliability of State's dollar estimates. We must for the safety of the Canal and the military and economic health of the country and the world be sure of what we are doing and most important be sure that we can rely on the word of the other contracting party:

If Panama, is exporting its revolutionary philosophy into the rest of Central America now, how much better able will they be to finance these adventures when, as these hopelessly bad treaties provide, our payments to her go from $2.3 million to nearly $100 million a year-$100 million a year will finance a great deal of revolution.

I attach as an appendix to this statement a summary of the evidence available in official U.S. government records and news sources regarding the illegal trafficking of firearms.

We have listened to many voices telling us what we must do to ransom the honor of the United States in view of the ratification of the Panama Canal Treaties. We must, so the argument goes, march in lock step into implementation on the Administration plan without looking either left or right to determine what are the facts and what are the considerations of serving the best interests of the people of our own country.

The entire and sole argument for the Treaties and the implementation which we are to take, like Socrates' hemlock, for the good of the nation is that they will improve our image with the rest of the world.

I urge this committee to dismiss such argumentation as nonsense and to examine the facts. Your inquiry in this matter will go a long way toward an answer to the

basic questions. Is Panama capable of running the Canal? If capable, is she reliable enough to entrust so formidable a weapon as the Canal?

A lesson of history is still vivid in our minds that draws a parallel situation, that of the Suez Canal and the years it remained closed.

Even should we accept the superficial argument that the Treaties are set in concrete, is the administration suggesting that breach by Panama is a boyish prank to be ignored to the prejudice of good order and safety in the entire world? It is plain that we simply do not have the right blindly to give away not only our own security but that of the entire West. If this Committee finds that there is substance to the apparent revolutionary acts of Panama mentioned here, we will have no option. Rather than subject Central and South America to the fate of southern Africa, duty will require us to defer or set aside the Panama Canal Treaties for what they have always been-foolish gestures to the advantage of no one but our mortal enemies.

THE SUEZ CANAL-THE LESSON OF HISTORY

The only international waterway comparable to the Panama Canal is the connective canal between the Red Sea and the Mediterranean, the Suez Canal. Like the Panama Canal, the Suez has for its entire history until recent times been under the protection of a major world power, the British. In all the time between its opening in 1869 and October, 1956, it remained open to world shipping on terms of relative equity.

In October, 1956, as a result of nationalization by Egypt, traffic in the Suez Canal was blocked for nearly seven months. For various reasons, intervention by Great Britain was impossible. The Soviet Union threatened both Britain and France with nuclear attacks on London and Paris over their intervention attempts. Ultimately, the Canal reopened in June, 1957.

Again in 1967, the Canal was blocked and went out of action, this time for eight years and again over a fight between two hostile lesser powers. In effect, for more than one third of the time since Great Britain relinquished control of the Suez, it has been out of action because its possessor has been unable to defend it or unwilling to see it operate with its benefits available to its adversary. World War was only a step away as a result of the conflict over the Canal and the Soviets, true to their unvarying foreign policy fished in the troubled waters including a threat of nuclear involvement.

If those events of the past twenty-three years have a familiar ring, it is because they are being replayed over our own Canal in the Panama Canal Zone. Panama claims the right to control the Canal which it did not and could not build. At the same time, it is attacking its neighbors and inviting retaliation. The Soviets, unchanging in their attitude are fishing in the troubled waters of the Carribean ready to pounce upon the Canal and deny its use to the West even if it means denying its use to anyone.

The crucial difference is that, unlike Suez, the United States could not survive eight years of a one ocean navy with a two ocean responsibility. It could not afford to allow its pipeline for oil from Alaska to be cut so as to deny the North East our own oil. In plain truth, a Suez shutdown in the Panama Canal simply cannot be allowed. Nor may we allow the circumstances to arise in which anyone could deny us the use of our own Canal.

Before the ink is dry on the neutrality treaty, Panama has made that agreement inoperable by its own actions. After Panama has launched attacks on its neighbors in Central America, there is no way for the treaty to be put in force. When those attacks are at the behest and for the benefit of the Cubans and Soviets, it would be insane to ignore them and pretend that Panama is a netural country with an international trust in the Canal.

Since the treaties are inextricable from each other, when the neutrality treaty became inoperable by the acts of the government of Panama, the Panama Canal Treaty itself became incapable of performance. How can a treaty be keyed to the efficient operation of the Canal be in force when one of the parties of the treaty is setting brush fire in Latin America which can only ultimately result in the regular and perhaps ultimately successful guerrilla attacks on the Canal?

The Panama Canal Treaty, in Article I, Section two, states an essential element of the Treaty. “The Republic of Panama guarantees to the United States of America the peaceful use of the land and water areas which it has been granted the right to use for such purposes pursuant to this treaty and related agreements."

There can be no doubt that direct unilateral acts by the government of Panama in provoking and initiating armed hostilities between itself and other Central

American states render such guarantees illusory. Their words guarantee what their actions make impossible.

Coupled with the dissolution of the Panama Canal Zone, which makes all of the territory of the Canal Panamanian, Panama is almost certain to bring into the immediate area of the Canal its ill-considered ventures in international guerrilla warfare. The Department of State knows full well that when the terms essential to a treaty are rendered impossible of performance by one of the parties to the treaty, that treaty ceases to be of any force and effect. When that breach of the terms of the treaty has occured prior to the entry into force of the treaty, the treaty is of no force and effect. It is to all intents and purposes, null and void.

EVIDENCE

(1) Affidavit filed Tuesday, May 1, 1979 in Miami Federal Court-Panamanian intelligence officials directed airline officials/Panamanian consul in Miami to smuggle arms to the Sandanista guerillas in Nicaragua-Affidavit by BATF Special Agent Donald Kimbler.

(2) Grand Jury indictments against: Jose A. Pujol; Miami air cargo manager for Air Panama. Jose Antonio (Tony) Alvarez; Miami gun dealer/exporter. Carlos Wittgreen; President of Caza y Pesca, partnership with Colonel (Brigadier General) Manuel Noriega-head of Panamanian G2; company is a front for Panama intelligence; reported Panama intelligence agent. James Allen Howell; diplomatic security analyst and former lecturer in electronic security and police subjects at the National Intelligence Academy in Fort Lauderdale, a private police training and equipment research firm. Walter Donald McComas; Miami Exporter.

May 15-Grand jury indictments:

The four-count indictment says all five conspired with the former Panamanian Consul in Miami, Edgardo Lopez to ship surplus military weapons to Panama without export licenses. All released on $25,000 bond.

(3) Kimbler's affidavit stated that Pujol acted as the middleman for Lopez in making gun deals with the Garcia National Gun Shop. Garcia employees stated that Pujol was prepared to make a $2 million purchase. Pujol said he would personally put the guns on an airplane without a license.

(4) Pujol purchased guns-paying cash-September 20, 1978. September 29, 1978. October 9, 1978. November 7, 1978. November 9, 1978.

(5) Kimbler interviewed Lopez and he admitted directing seven arms purchases on orders of intelligence officers in Panama.

(6) 1975 payroll records of the Panamanian National Guard show Lopez as a G2 agent with a salary second only to Colonel Noreiga.

(7) March 13 and 16, 1979 two vans equipped with false compartments were intercepted at Penas Blancas on the Costa Rica-Nicaragua border by the Nicaraguan National Guard. 70 M1 Carbines were traced to Universal Arms of Florida and Johnson Arms of New Jersey, manufacturers of these arms, which had then been shipped to the non-existent Caza y Pesca S.A. In Panama.

(8) On May 4, 1979, CRITICA, the government-backed Panamanian newspaper published an open call for recruits to join the Panamanian international brigade. The call was made by Dr. Hugo Spadafora, former Vice-Minister of Health in Panama, and a close friend, former roomate of Panama's President Aristedes Royo.

(9) On May 3, 1979, BATF agents in Texas arrested 4 men in a gun-running conspiracy involving 1,000 machine guns. Bail for one of the defendants was set at $1 million. BATF agents seized a shipment of machine gun parts on January 12, 1979. A Federal Grand Jury at Brownsville, Texas indicted the 4 men on April 24, 1979. It was reported that machine guns and parts had been shipped to Panama.

(10) President Royo on May 11, 1979 stated that he had received no pressure from the U.S. to stop any kind of aid” to the Nicaraguan terrorists.

(11) On November 28, 1978, State Department spokesman, Hodding Carter, said the Carter Administration had been unable to confirm reports that Cuba and other Latin American governments had been supplying weapons to the Sandinistas.

(12) The AP on May 5, 1979 quoted extensively from an unnamed Nicaraguan official as saying that the Carter Administration clearly had full knowledge that Panama was trafficking in arms on behalf of the Sandinistas but had taken no action to alert the Nicaraguan Government for fear of placing the Panama Canal treaties in jeopardy.

Mr. HANSEN. And also for the record I would like to introduce two Congressional Records and reports that were made during the time of the identification of the gun running, which I feel is perti

nent to the testimony before the committee, along with my testimony.

Mr. HUBBARD. Thank you.
[The following was received for the record:)

(From the Congressional Record, Vol. 125, No. 64, Monday, May 21, 1979)

A LAKE OF FIRE AND BRIMSTONE?—PANAMA GUN RUNNING IN THE CARIBBEAN (Mr. Hansen asked and was given permission to revise and extend his remarks.)

Mr. HANSEN. Mr. Chairman, the Panamanian G-2 intelligence arms-smuggling operation on behalf of the Nicaraguan Marxist terrorists has now resulted in five persons being indicted in Miami on May 15. The operation was first made public by a sworn affivdavit filed in the Miami Federal Court on May 1, by the U.S. Bureau of Alcohol, Tobacco, and Firearms. This affidavit said that José A. Pujol, cargo manager of Air Panama, and Edgardo Lopez, “then Consul” of Panama in Miami, had shipped weapons to “Nicaraguan guerilla forces.” Pujol was stated as seeking to buy $2 million in arms.

On May 16, the Miami Herald reported the following as having been indicted by the Miami Federal grand jury in connection with the case.

José A. Pujol, 36, Miami air cargo manager for Air Panama.
José Antonio (Tony) Alvarez, 31, a Miami gun dealer and exporter.

Carlos Wittgreen, president of Caza y Pesca, a Panamanian company and reported G-2 intelligence agent.

James Allen Howell, 33, diplomatic security analyst and former lecturer in electronic security and police subjects at the National Intelligence Academy in Fort Lauderdale, a private police training and equipment research firm.

Walter Donald McComas, 41, a Miami exporter.

According to this newspaper report, Special Agent Donald Kimbler of the Bureau of Alcohol, Tobacco, and Firearms asked Judge Palermo to place a $100,000 bond on Alvarez because of the latter's close connection with Col. (sic) Manuel Noriega, head of the Panamanian G-2 intelligence, Antonio (Tony) Alvarez is a Cuban exile married to a Panamanian closely linked to Carlos Wittgreen, also indicted.

The four-count indictment says all five conspired with the former Panamanian consul in Miami, Edgardo Lopez, to ship surplus military weapons to Panama without export licenses.

Questioned on the role of consul Edgardo López in this affair, Panama President Arístedes Royo said in Washington, D.C. on May 11 that López was not consul at the time he was interviewed by Alcohol, Tobacco and Firearms agents on November 10, 1978 and, therefore, acted in a private capacity. President Royo said López had been replaced as consul on October 11, U.S. State Department records, however, show that Edgardo López remained on as consul until December 1 or later. The State Department is unclear on the exact date. To the Alcohol, Tobacco and Firearms agents, López admitted, on November 10, 1978, to supervising seven shipments of arms to Panama on direct orders of officers in the Panamanian G-2 Intelligence. 1975 payroll records of the Panamanian National Guard show López as a G-2 agent.

Carlos Wittgreen indicted on May 15 in absentia, is described as President of Caza y Pesca S.A., of Panama. According to Nicaraguan intelligence, this is a front operated by the Panamanian G-2 Intelligence, Nicaraguan intelligence also stated that Wittgreen was in Miami in February of this year attempting to buy 5,000 weapons. Arrested on February 22 as he attempted to leave the country with 22 weapons for which export licenses had not been issued, he was almost immediately released "on orders from higher up." The State Department has since indicated that he had a valid license for the export of 150 carbines.

On March 13 and 16, 1979, two vans equipped with false compartments were intercepted at Peñas Blancas on the Costa Rica-Nicaragua border by the Nicaraguan National Guard. Seized were 90 M-1 carbines, 34 FAL 7.62 cal rifles, and large quantities of ammunition and material. According to Nicaragua sources, 70 M-1 carbines were traced to Universal Arms of Florida and Johnson Arms of New Jersey, manufacturers of these arms which had then been shipped to the nonexistent Caza y Pesca S.A. in Panama.

On May 10, the Nicaraguan Ministry of Foreign Affairs expressed its serious concern over public events which show the involvement of the Government of Panama in the supply of arms to subversive forces attempting a takeover of the Government of Nicaragua. The Nicaraguan authorities have repeatedly protested the interference of the Government of Panama in the internal affairs of the country which has contributed to subverting public order in Nicaragua. This has included

the organizing in Panama of international brigades to join the ranks of the Marxist Frente Sandinista de Liberacion National (FSLN) terrorist movement, attempting to overthrow the government of President Somoza.

Critica, the government-backed Panamanian newspaper of May 4, published an open call for recruits to join the Panamanian international brigades.

The call was made by Hugo Spadafora, former Vice Minister of Health in Panama, and close friend and one-time roommate of Panama's President Aristedes Royo. Spadafora is also known for his participation on behalf of the terrorist movement led by Amilcar Cabral in Guinea-Bissau.

On May 3 the U.S. Bureau of Alcohol, Tobacco and Firearms announced that its agents in Texas had arrested 4 men indicated in an alleged gunrunning conspiracy involving 1,000 machineguns. Bail for one of the defendants was set at $1 million. The Alcohol, Tobacco and Firearms agents seized thousands of machinegun parts on January 12 at a location in Devine, Tex., and a Federal grand jury at Brownsville indicted the four men on April 24. It is reported that machineguns and parts had been shipped to Panama.

President Aristedes Royo of Panama said at his press conference on May 11 in Washington, D.C.:

"We have enough intelligence, first, not to assign a consul to buy arms; second, not to put its arms in a commercial flight to Air Panama. I would say that if I am going to smuggle arms, as a head of government, in my account, we have planes in the Panamanian Air Force."

At the U.S. State Department press briefing on May 16, spokesman Hodding Carter asked whether the Department planned to investigate or give information on the Miami grand jury indictments, in view of the possible effect this could have on U.S. aid to Panama said simply that he would “take the question."

President Royo on May 11, said he had received no pressure from the United States to stop “any kind of aid" to the Nicaraguan terrorists, despite the fact that in January, Carter administration officials had to dissuade Torrijos from sending troops to aid the Sandinista guerrillas.

Yesterday, May 20, the Miami Herald printed the following complaint by Nicaraguan President Somoza:

SOMOZA Says COMMUNISTS LEAD UNREST MANAUGA, NICARAGUA.-President Anastasio Somoza has accused Panama-based Communists of joining with several past and present presidents of neighboring nations in an attempt to overthrow him.

Somoza went on nationwide television and radio Friday after moderate opposition leader Alfonso Robelo called for a three-year provisional government to end what he called the bloodbath in which Nicaragua is drowning.”

Somoza attacked President Aristides Royo of Panama, Panama military strongman Gen. Omar Torrijos, President Rodrigo Carazo of Costa Rica and former President Carlos Andres Perez of Venezuela.

“We will call Royo a liar when he says in Washington that he knows nothing about the battalions that have arrived in Nicaragua, battalions of mercenaries trained in Panama . . ." Somoza said.

“Eleven Panamanians, five Costa Ricans and three Spaniards, fooled by Omar Torrijos, have died in fighting with the national guard in Nueva Guinea (in southeastern Nicaragua)," he said. “They were all members of an international Communist ring.”

Somoza called Carazo a “puppet” and said guerrilas, supported by Venezuela, Panama and Costa Rica, were crossing into Nicaragua from Costa Rica.

“Nicaraguans must be aware that there are messianic individuals like Carlos Andres Perez, with only a high school education ... who, crazed by Venezuelan money, have thrown away millions trying to stir up the peaceful people of Nicaragua," Somoza said.

In an earlier speech, Luis Pallais Debayle, editor of the Somoza-owned newspaper Novedades, accused the nation's clergy of "openly supporting subversion.”

Robelo, a leader of the Broad Opposition Front recently released from 10 days in jail, urged opposition groups to unite and form a provisional government to replace the regime of Somoza.

With the recent terrorism in El Salvador and revelations of Soviet missile and submarine activity in Cuba. Latin America is becoming a real hotbed of military activity. Today we find the President of Mexico in company with the President of Costa Rica breaking diplomatic relations with Nicaragua just after a visit from Fidel Castro of Cuba. The Washington Post of May 21 tells the story:

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