Trump's Panama Win

By Rich Lowry on Feb 3, 2025

Teddy Roosevelt would presumably be pleased. President Trump spoke loudly and swung a big stick in Panama's direction, and it produced instantaneous results when Secretary of State Marco Rubio visited the small Central American nation.

President Jose Raul Mulino Quintero said that Panama won't renew its participation in China's Belt and Road Initiative, Beijing's global influence operation, and may terminate the relationship early. He said Panama will review its arrangement with a Hong Kong-based company to operate ports on either end of the canal. And he reportedly offered U.S. Naval ships an exemption from canal transit fees.

Mulino also threw in a concession regarding the repatriation of migrants using the Darien Gap, the jungle straddling Panama and Colombia, on their way to our southern border.

Not bad for a day's work. At this early juncture, Marco Rubio has the easiest job in the world. Fear of his boss, who is determined to throw his weight around in our hemisphere in a way we haven't seen from a U.S. president in 100 years or so, is opening up doors.

The Panamanian political leadership presumably hasn't been sleeping so well the past several weeks. After the election, Trump began banging the drum about Panama's mismanagement of the canal. Then, in a truly extraordinary line in his Inaugural Address that didn't get much attention given the rush of other events, he pledged to take it back.

Would Trump really engage in an act of war that would have far-reaching consequences impossible to predict? Well, who in Panama wants to find out?

Panama had signed up to Belt and Road in 2017, right around the time it dumped diplomatic relations with Taiwan to please China, and Beijing's presence increased accordingly. According to the Center for Strategic & International Studies, "Chinese companies have been heavily involved in infrastructure-related contracts in and around the canal in Panama's logistics, electricity and construction sectors."

If not a violation of the letter of the Panama Canal Treaties, the Chinese operations certainly run counter to their spirit. The Panama Canal Treaty handed control of the canal to Panama, while the Neutrality Treaty guaranteed its permanent neutrality and stipulated that the U.S. could use force to address threats to that neutrality.

The canal, all 51 miles of it, is among the most crucial waterways in the world; it is of incalculable commercial and strategic importance to the United States. For the average ship to travel between New York City and San Francisco around South America takes at least 27 days; for such a ship to travel between the two cities using the Panama Canal takes at least 11 days.

The reduced time and distance are a major economic boon; the Council on Foreign Relations notes that about 40% of the U.S. container traffic goes through the canal every year. Also, our ability to readily move Naval ships -- and supplies -- between the Atlantic and Pacific Oceans in a crisis is a national necessity.

TR, who was also quite comfortable with high-handed international dealings, would presumably appreciate Trump's sensitivity about the canal. We built the canal, one of the engineering marvels of the day, after helping Panama achieve independence from Colombia. Roosevelt the nationalist envisioned the canal as an essential tool of U.S. economic and geopolitical power, and so it has proved.

We never should have given away such an invaluable national asset, but U.S. policymakers in the 1960s and 1970s bowed to Panamanian discontent over a foreign country controlling the Canal Zone. Henry Kissinger warned of "riots all over Latin America" if we didn't give in. Conservatives like Ronald Reagan vociferously opposed the treaties, but President Jimmy Carter managed to get them through the U.S. Senate in 1977.

Now, Trump is channeling that long-ago sentiment. To paraphrase the slogan of the treaty opponents, Trump thinks, "We bought it, we paid for it, we never should have relinquished it -- and we're watching it like a hawk."

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(Rich Lowry is on Twitter @RichLowry)