[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]




     LOSING PANAMA: THE IMPACT ON REGIONAL COUNTERDRUG CAPABILITIES

=======================================================================

                                HEARING

                               before the

                   SUBCOMMITTEE ON CRIMINAL JUSTICE,
                    DRUG POLICY, AND HUMAN RESOURCES

                                 of the

                              COMMITTEE ON
                           GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 4, 1999

                               __________

                           Serial No. 106-76

                               __________

       Printed for the use of the Committee on Government Reform


  Available via the World Wide Web: http://www.gpo.gov/congress/house
                      http://www.house.gov/reform

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
62-236 CC                   WASHINGTON : 2000




                     COMMITTEE ON GOVERNMENT REFORM

                     DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York         HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland       TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut       ROBERT E. WISE, Jr., West Virginia
ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
STEPHEN HORN, California             PAUL E. KANJORSKI, Pennsylvania
JOHN L. MICA, Florida                PATSY T. MINK, Hawaii
THOMAS M. DAVIS, Virginia            CAROLYN B. MALONEY, New York
DAVID M. McINTOSH, Indiana           ELEANOR HOLMES NORTON, Washington, 
MARK E. SOUDER, Indiana                  DC
JOE SCARBOROUGH, Florida             CHAKA FATTAH, Pennsylvania
STEVEN C. LaTOURETTE, Ohio           ELIJAH E. CUMMINGS, Maryland
MARSHALL ``MARK'' SANFORD, South     DENNIS J. KUCINICH, Ohio
    Carolina                         ROD R. BLAGOJEVICH, Illinois
BOB BARR, Georgia                    DANNY K. DAVIS, Illinois
DAN MILLER, Florida                  JOHN F. TIERNEY, Massachusetts
ASA HUTCHINSON, Arkansas             JIM TURNER, Texas
LEE TERRY, Nebraska                  THOMAS H. ALLEN, Maine
JUDY BIGGERT, Illinois               HAROLD E. FORD, Jr., Tennessee
GREG WALDEN, Oregon                  JANICE D. SCHAKOWSKY, Illinois
DOUG OSE, California                             ------
PAUL RYAN, Wisconsin                 BERNARD SANDERS, Vermont 
JOHN T. DOOLITTLE, California            (Independent)
HELEN CHENOWETH, Idaho


                      Kevin Binger, Staff Director
                 Daniel R. Moll, Deputy Staff Director
           David A. Kass, Deputy Counsel and Parliamentarian
                      Carla J. Martin, Chief Clerk
                 Phil Schiliro, Minority Staff Director
                                 ------                                

   Subcommittee on Criminal Justice, Drug Policy, and Human Resources

                    JOHN L. MICA, Florida, Chairman
BOB BARR, Georgia                    PATSY T. MINK, Hawaii
BENJAMIN A. GILMAN, New York         EDOLPHUS TOWNS, New York
CHRISTOPHER SHAYS, Connecticut       ELIJAH E. CUMMINGS, Maryland
ILEANA ROS-LEHTINEN, Florida         DENNIS J. KUCINICH, Ohio
MARK E. SOUDER, Indiana              ROD R. BLAGOJEVICH, Illinois
STEVEN C. LaTOURETTE, Ohio           JOHN F. TIERNEY, Massachusetts
ASA HUTCHINSON, Arkansas             JIM TURNER, Texas
DOUG OSE, California

                               Ex Officio

DAN BURTON, Indiana                  HENRY A. WAXMAN, California
          Robert B. Charles, Staff Director and Chief Counsel
                 Gil Macklin, Professional Staff Member
              Sean Littlefield, Professional Staff Member
                          Amy Davenport, Clerk
                    Cherri Branson, Minority Counsel




                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on May 4, 1999......................................     1
Statement of:
    Romero, Ambassador Peter F., Acting Assistant Secretary, 
      Bureau of Western Hemisphere Affairs, Department of State; 
      and Ana Maria Salazar, Deputy Assistant Secretary, Drug 
      Enforcement Policy and Support, Department of Defense......    19
    Sumner, Lt. General Gordon, U.S. Army (Ret.); Dr. Mark 
      Falcoff, resident scholar, American Enterprise Institute 
      for Public Policy Research; and Larry Lyons, former DEA 
      Attache, Bogota, Colombia..................................    78
Letters, statements, et cetera, submitted for the record by:
    Burton, Hon. Dan, a Representative in Congress from the State 
      of Indiana, prepared statement of..........................    12
    Falcoff, Dr. Mark, resident scholar, American Enterprise 
      Institute for Public Policy Research, prepared statement of    90
    Gilman, Hon. Benjamin A., a Representative in Congress from 
      the State of New York, prepared statement of...............     9
    Kucinich, Hon. Dennis J., a Representative in Congress from 
      the State of Ohio, prepared statement of...................    17
    Mica, Hon. John L., a Representative in Congress from the 
      State of Florida, prepared statement of....................     4
    Romero, Ambassador Peter F., Acting Assistant Secretary, 
      Bureau of Western Hemisphere Affairs, Department of State:
        Information concerning coverage with potential FOLs......    58
        Prepared statement of....................................    24
    Salazar, Ana Maria, Deputy Assistant Secretary, Drug 
      Enforcement Policy and Support, Department of Defense:
        Excerpt from State Department Circular 175...............    61
        Information concerning American personnel................    49
        Information concerning cost outlines.....................    51
        Information concerning costs to establish a FOL..........    48
        Information concerning National Guard counterdrug support 
          to New York............................................    67
        Information concerning scheduled flights.................    50
        Prepared statement of....................................    35
    Sumner, Lt. General Gordon, U.S. Army (Ret.), prepared 
      statement of...............................................    82

 
     LOSING PANAMA: THE IMPACT ON REGIONAL COUNTERDRUG CAPABILITIES

                              ----------                              


                          TUESDAY, MAY 4, 1999

                  House of Representatives,
Subcommittee on Criminal Justice, Drug Policy, and 
                                   Human Resources,
                            Committee on Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:30 a.m., in 
room 2154, Rayburn House Office Building, Hon. John L. Mica 
(chairman of the subcommittee) presiding.
    Present: Representatives Mica, Barr, Gilman, Mink, 
Kucinich, and Burton [ex officio].
    Staff present: Robert B. Charles, staff director and chief 
counsel; Gil Macklin and Sean Littlefield, professional staff 
members; Amy Davenport, clerk; Cherri Branson, minority 
counsel; and Jean Gosa, minority staff assistant.
    Mr. Mica. I'd like to call this meeting of the House 
Subcommittee on Criminal Justice, Drug Policy, and Human 
Resources to order this morning, and welcome to our 
subcommittee.
    We will begin this morning's hearing with opening 
statements. I will provide the first opening statement. Then 
I'll yield to our ranking member and other Members as they join 
us this morning.
    Today, the subcommittee will address the situation that I 
believe is one of our Nation's No. 1 national security and 
social problems, the problem of illegal narcotics. Our primary 
focus today is to examine the status of the United States 
interdiction efforts in Panama and in the Western Hemisphere.
    It's my contention that it is both common sense and cost-
effective to stop illegal narcotics before they end up on our 
streets. In fact, every kilo of cocaine or high-purity heroin 
that is stopped before it reaches our ports and borders saves 
lives.
    Just last week, General McCaffrey, our Nation's drug czar, 
testified before the Senate that drug traffickers in Colombia 
have discovered a new chemical process that will allow them to 
slip cocaine past drug-sniffing dogs and also past the eyes of 
Customs by manufacturing what is being termed ``black 
cocaine.'' This is yet another example of no matter how strong 
our efforts are along our Nation's borders and on our Nation's 
streets, we will not stop cocaine and heroin unless we have a 
vigorous interdiction and eradication strategy.
    One of the most crucial elements of our interdiction and 
eradication efforts has been the operations that the United 
States has headquartered from our bases in Panama. 
Unfortunately, failed United States/Panama negotiations during 
the past couple of years, and due to the terms of the Carter-
Torrijos treaty, future flights from Panama for the 
surveillance of narcotics interdiction purposes have been 
blocked.
    On May 1, the United States ceased all narcotic 
surveillance flights from Howard Air Force Base in Panama. By 
the end of this year, the United States will have abandoned 
property consisting of about 70,000 acres and over 5,600 
buildings. These assets have an estimated value somewhere in 
the neighborhood of $10 billion. What President Carter started 
in the late 1970's, President Clinton is finishing in the late 
1990's with this takeover of all of the U.S. assets.
    I would like to spend a moment explaining the importance of 
having a strong presence in this region. The United States has 
been conducting about 15,000 antinarcotics flights annually 
from Howard Air Force Base. These flights are the cornerstone 
of our counternarcotic efforts in this hemisphere. These 
flights make it possible for effective eradication and 
interdiction missions in source and also in the transit zones.
    In the past few days, the administration has managed to 
hobble together several interim agreements to replace some of 
these counternarcotic missions. Interim agreements with the 
Caribbean island nations of Curacao and Aruba, as well as an 
agreement with Equador, are being pieced together. Reportedly, 
the administration is also working out at this time an 
agreement with Costa Rica.
    I look forward to hearing an update on the progress of 
these matters from DOD today as they provide us with their plan 
to have these bases fully operating. Hopefully, we can avoid a 
near-term gap and without the damaging loss of critical 
coverage for the strategic mission.
    We also need to hear today from the State Department on 
both the handling of the interim agreements and to learn about 
the progress on status of long-term agreements with these 
nations that will be our host for this mission in the future. 
Unfortunately, in both the near term and long term, our 
interdiction capabilities may be greatly diminished. By 
SOUTHCOM's own admission, the FOLs in Curacao, Aruba and 
Ecuador may provide only 70 to 80 percent of the coverage that 
we've had formerly with Howard Air Force Base in our operations 
out of Panama.
    I'm also concerned about the costs related to this move. 
DOD estimates that the costs for upgrade and repair for the 
four FOLs will--and this new location effort will cost anywhere 
from $70 to $100 million. Additionally, Congress may foot the 
bill, with estimates as high as $200 million, to complete the 
upgrades and repairs at the base in Manta, Ecuador.
    A full DOD assessment and proposal still needs to be 
completed. This assessment, as well as long-term agreements or 
concrete plans for filling this surveillance gap, must be 
completed expeditiously.
    Our second panel today will deliver an appraisal of what 
the impact of the United States departure from Panama will mean 
to the citizens of Panama, the safety of the canal, the 
stability of the region and, most particularly, our efforts to 
curtail illegal narcotics production and trafficking in that 
region.
    At this time, we all know there's a full-scale guerrilla 
war going on, primarily financed by the narcotics trade which 
is raging south of Panama in the Republic of Colombia. There 
have been many news reports of recent FARC activities in 
Panama's southern Darien region. In fact, the FARC captured 
three New Tribes missionaries in the Darien province in 1993. 
They happened to be representatives of the New Tribes Mission 
which is in my district. So I followed that case very closely 
and that situation. These missionaries, in fact, remain 
unaccounted for to this day.
    With guerillas already based in Panama and with the United 
States withdrawal this year, we anticipate further incursions 
into Panama and additional narcoterrorist activities. In the 
aftermath of the United States efforts in Panama 10 years ago 
to go after General Noriega who was involved in illegal 
narcotics trafficking, we ensured that corrupt--that the 
corrupt Panamanian military organization was dissolved, and now 
the security of Panama is in the hands of an institutionally 
weak police force. Even as they celebrate the election of a new 
leader this past weekend, these are some of the challenges that 
they face in the months and years ahead.
    I'm frankly concerned that the FARC will move further north 
than they previously have and create a more unstable situation 
in Panama. I'm also concerned that the United States will be 
back in Panama at some time in the future, and possibly at a 
great cost and sacrifice, to preserve the sanctity of the canal 
and protect our national interests, including what I foresee as 
potential for more trafficking in illegal narcotics, more money 
laundering, more corrupt activities in the Panama region.
    With cessation of our antinarcotics flight from Panama this 
past weekend and given the history of illegal narcotics 
trafficking in that country, we face a serious challenge in the 
months ahead. Hopefully, today's hearing will shed light on 
where we are in that region and what's being done to protect 
American interests.
    I do want to yield at this time to the ranking member of 
our subcommittee, Mrs. Mink. Mrs. Mink, myself, and other 
members of the subcommittee traveled to Panama earlier this 
year and obtained firsthand a briefing on what was taking place 
at that time, and I think that this hearing is a very important 
and responsible followup to those efforts in making certain 
that we have this matter well under control and conduct proper 
oversight of what our agencies are doing to deal with this 
transition.
    So, at this time, I'd like to yield to Mrs. Mink. Thank 
you.
    [The prepared statement of Hon. John L. Mica follows:]
    [GRAPHIC] [TIFF OMITTED] T2236.001
    
    [GRAPHIC] [TIFF OMITTED] T2236.002
    
    Mrs. Mink. I thank the chairman of the subcommittee for 
yielding. I certainly concur with the chairman's remarks that 
this is an appropriate follow-on from our earlier opportunities 
to discuss the issue of Panama and the importance of the 
transfer of responsibility regarding surveillance of illegal 
narcotics traffic and the key role that Howard Air Force Base 
and our facilities there and our personnel played in helping 
the United States to know what was being trafficked out and 
where and to whom. The issue that faces this country and this 
administration certainly is an appropriate topic for this 
subcommittee to ascertain what alternate processes are in place 
to take over the important role that Howard Air Force Base has 
played.
    I concur with the Chair's observations that it's 
unfortunate that we could not have entered into some interim 
agreement with the Panama Government for an interim continuance 
of these surveillance activities, but that issue is behind us, 
and what we have as a responsibility in this subcommittee is to 
insist upon a full and accurate briefing in terms of all the 
government agencies' concurrent responsibilities as to the 
important takeover responsibilities that they now have in the 
absence of our ability to command posts out of Panama.
    The hearings and discussions that we had in our trip 
indicate that these plans are in place, although perhaps not in 
a final confirmed form. So I hope that today in this 
subcommittee hearing we will learn more and gain greater 
assurance as to our government's ability to continue the 
important work of covering and maintaining surveillance over 
these narcotic activities.
    Thank you, Mr. Chairman.
    Mr. Mica. I thank the gentlelady. I'd like to yield now to 
the--also a member of our panel but the chairman of the 
International Relations full committee. I see we've also been 
joined by the chairman of our full committee, Mr. Burton, and 
without objection, I'd like to yield to him right after I yield 
now to Mr. Gilman. Thank you.
    Mr. Gilman. Thank you, Mr. Chairman. I want to commend 
Chairman Mica for calling this hearing, and it comes in a 
timely period. I've refrained from making any public statements 
regarding Panama, lest my words be misconstrued within the 
context of Panama's electoral politics, but since Panama held 
its elections on Sunday and we have a new President in Mireya 
Moscoso, it's now time to speak up.
    And I'm deeply alarmed, Mr. Chairman, by the 
administration's disjointed and half-hearted response to the 
impending withdrawal of our United States forces from Panama. 
Howard Air Force Base is a crown jewel in our fight against 
narcotics in a region that produces all of the world's cocaine 
and more and more of the heroin sold in our Nation and 
elsewhere. Our Nation should not have put itself in a position 
of closing down the Howard Air Force Base on May 1st.
    On April 27th, our National Drug Control Policy Director, 
General McCaffrey, told the Senate Armed Services Subcommittee 
on Emerging Threats and Capabilities that we're not fighting a 
war against drugs. The shameful retreat from Panama which we 
are now witnessing proves General McCaffrey's point. The 
administration has been reluctant to wage a full war on drugs. 
We are all focused on the war in Kosovo. However, very much 
closer to home, it's important to look at the distressing 
developments in the Andean region which coincide with our 
withdrawal from Panama.
    The administration has underestimated the severity and is 
ill-prepared to respond to the growing crisis in the Andean 
region. In Colombia, President Andre Pistrana is at a 
tremendous disadvantage as he tries to negotiate a peace with 
vicious narcoterrorists who wantonly kidnap and murder American 
citizens.
    Panama's Darien province is threatened by these same 
criminal narcoterrorist elements. Venezuela's democracy appears 
to be in the process of unraveling. After suffering hundreds of 
millions in economic damage from El Nino, Ecuador is now facing 
one of the world's worst economic crises--one of the worst 
economic crises in its history.
    In Peru, we took our eye off the ball. We cut back on 
aerial coverage in support of Peru's shootdown policy. 
Regrettably, now coca prices are once again soaring in Peru 
from $1.50 to $2.40 per kilo of coca leaf, and the farmers are 
coming back into illicit drug cultivation.
    The entire region is suffering, once again, from all of 
these threats. I'm shocked to see our Nation scrambling to 
conclude hasty, temporary arrangements with the Netherlands/
Antilles and Ecuador for new forward bases in the region from 
which to deploy our military and civilian antidrug forces, and 
while I greatly appreciate the willingness of our Dutch allies 
and the Ecuadorian Government to step up to the plate in our 
fight against drugs, these improvised arrangements will 
significantly undercut our Nation's counternarcotic efforts.
    I closely followed former Ambassadors Ted McNamara's and 
Bill Hughes' substantial efforts to conclude an agreement for a 
continued United States presence in Panama. We then traveled to 
Panama and talked to the Foreign Minister who was initially 
supportive of our efforts but the election process got in the 
way. Regrettably, these efforts did not result in the promised 
multilateral counter-narcotics center, the MCC, which is 
supported by so many of the countries in the region.
    On the one hand, these negotiations became entangled in 
Panama's internal electoral policies. On the other hand, the 
Department of Defense, in particular our Air Force, did not 
provide the support, the flexibility and the creative diplomacy 
that were needed to secure this vitally important continued 
United States presence in Panama.
    Last October, I introduced H.R. 4858, the United States 
Panama Partnership Act of 1998, and the purpose of that 
legislation was to signal to the people of Panama the strong 
interest by the Congress in continuing into the next century 
the special relationship that has existed between our two 
peoples since 1903.
    A 1977 protocol to the Panama Canal Treaties provides that 
the United States and Panama may agree to extend the United 
States military presence in Panama beyond 1999. When those 
treaties were signed, the current crisis in the Andean region 
could not have been foreseen.
    H.R. 4858, which I've introduced, offers Panama the 
opportunity to join Canada and Mexico in forging a new, more 
mature, mutually beneficial relationship with our Nation. In 
exchange, this legislation asks Panama to remain our partner in 
our war against drugs and other regional security matters by 
continuing to host the United States military presence after 
1999.
    Mr. Chairman, I look forward to today's testimony by our 
expert witnesses, and thank you once again for conducting this 
very important hearing.
    [The prepared statement of Hon. Benjamin A. Gilman 
follows:]
[GRAPHIC] [TIFF OMITTED] T2236.003

    Mr. Mica. I thank the gentleman from New York, and now, I'd 
like to yield to the chairman of our full committee, Mr. 
Burton.
    Mr. Burton. Thank you, Chairman Mica. I'm glad that Mr. 
Romero is here with us today. It's unfortunate that we had to 
threaten to use a subpoena to get you here, but it's nice that 
you did appear.
    For the past 3 years, Chairman Gilman, myself, Chairman 
Mica and others have been doing everything we can to equip the 
Colombian National Police with the proper tools to fight 
against the FARC guerillas and the drug cartel down there. 
After many, many meetings with the State Department, during 
which they said that they would get those Blackhawk helicopters 
down there and the super-HUEYS and the mini-guns and everything 
else, we finally saw some results last Friday, but it was 3 
years.
    Now, 4,000 Colombian National Police have been killed, and 
many, many more have been injured because of the foot-dragging 
and the poor performance, in my opinion, of the State 
Department in dealing with the FARC guerillas.
    And one of the things that really concerns me is that we 
have had a policy in the United States of not dealing with 
terrorist organizations. That's been a stated policy of every 
President that I can remember. And yet last December, the 
Clinton-Albright diplomats did go down and meet with and 
negotiate with the Colombian FARC in Costa Rica.
    Now, there's been a little semantic dancing that's taken 
place. They said they weren't negotiations, they were just 
meetings. Well, these people have killed Americans, they've 
taken Americans hostage. We were sitting across the table with 
them. I don't think we were just having tea and crumpets. I 
think that was a negotiating session. And you know, Shakespeare 
said, ``A rose by any other name would smell as sweet,'' and I 
think it's disingenuous for the State Department and Mr. Romero 
to say these meetings were not negotiations; and, if you like, 
we could get the dictionary out and define what negotiations 
are and what meetings are. I think it kind of clears things up, 
and this isn't the first time the Clinton administration has 
made a career out of redefining words and phrases that seem to 
suit their needs. Their ability to do that just staggers the 
imagination.
    Even more disturbing has been the State Department's lack 
of respect for congressional concern in this matter. After we 
called Phil, the State's diplomat to the Hill to explain, he's 
allegedly continued to keep in contact with the FARC 
representatives through e-mail and possible phone 
conversations, and this has continued despite the FARC 
kidnapping and the brutal execution of three Americans.
    The message to the FARC has to be crystal clear, and that 
is, that the United States and the Government of Colombia are 
not dealing from a position of strength but a position of 
weakness down there, hat in hand, sitting across the table, 
talking to these guys, even though they're killing people and 
kidnapping them.
    The Clinton-Albright State Department has gone to great 
length to avoid confrontation of any kind with the FARC until 
possibly last week when we went up to Connecticut to see those 
Sikorsky helicopters. Those six helicopters were going to be 
delivered down there. And it appears as though the State 
Department's had an insatiable desire to see peace at any cost. 
Unfortunately, that cost has been very high. As I said before, 
our allies in the war on drugs, the Colombian National Police 
and others, have lost over 4,000 personnel.
    In the last 5 years there have been 20 Americans taken 
hostage, 6 have been murdered, murdered by the Colombian 
narcoguerillas. Currently, the FARC has held three Americans 
from Chairman Mica's district, Rick Tenennof, Mark Rich, and 
David Mankin since 1993. They're the longest-held hostages 
anywhere in the world.
    What my colleagues may not realize is that there have been 
more Americans taken hostage in Colombia in the last 5 years 
than were taken in Lebanon during the 1980's, and we weren't 
negotiating with the terrorists back then, but we have been 
negotiating with the FARC guerillas, and we need to know why.
    And then there's there one other thing I'd like to mention, 
Mr. Chairman, and that is Cuba, the only Communist dictatorship 
in this hemisphere, has been working with the FARC guerillas. 
The Clinton administration has opposed our embargo against Cuba 
and has done everything possible to erode it, and of course, 
last night, we saw another manifestation of that. The fact of 
the matter is the FARC is linked to the Communist regime in 
Cuba. Some FARC leaders have been educated and trained by 
Castro's government. The FARC very well may be laundering 
hundreds of millions of dollars in drug money through 
investments in Cuba, and there were 7.2 metric tons of cocaine 
that the Colombian National Police just captured recently which 
was destined for Cuba. Cuba said they didn't know anything 
about it. That is the most ridiculous thing I've ever heard. 
Obviously, they knew about it. That was going to be cut to 
probably hundreds of millions of dollars in street value and 
sold in the United States and possibly Europe, and Castro knows 
when that stuff is going on in Cuba.
    We know for a fact that the intermediary for the United 
States-FARC meeting in Costa Rica is Alvaro Lava, a former 
Colombian Congressman under indictment in Colombia and under 
political protection in Costa Rica, and is a frequent traveler 
to Cuba. Yet, we have permitted him to open a negotiating 
dialog with the FARC.
    In summary, Mr. Chairman, this administration, in my 
opinion, has dropped the ball in Latin America. I dare say the 
policy in Latin America would be of greater concern to Congress 
if the Clinton administration had not created crises in other 
areas of the globe. I mean, people in this country are very 
concerned about their kids dying from overdoses of drugs and 
the prisons being packed with drug dealers that are being 
supplied with narcotics and weapons from Central and South 
America. Someone needs to keep an eye on this area of the 
world, our own backyard, before our country becomes even more 
awash in the drugs that these countries are peddling to our 
children. And Mr. Chairman, I hope I'm able to stay here, 
because I really would like to ask Mr. Romero a number of 
questions that I think are very important.
    Thank you.
    [The prepared statement of Hon. Dan Burton follows:]
    [GRAPHIC] [TIFF OMITTED] T2236.004
    
    [GRAPHIC] [TIFF OMITTED] T2236.005
    
    [GRAPHIC] [TIFF OMITTED] T2236.006
    
    [GRAPHIC] [TIFF OMITTED] T2236.007
    
    Mr. Mica. Thank you, Mr. Chairman. At this time, I'd like 
to yield to the gentleman from Ohio, Mr. Kucinich, for an 
opening statement.
    Mr. Kucinich. Thank you, Mr. Chairman. Thank you for 
calling these hearings. I admire your dedication to this issue. 
I have a statement I'd like submitted for the record.
    Mr. Mica. Without objection it will be made part of the 
record.
    [The prepared statement of Hon. Dennis J. Kucinich 
follows:]
[GRAPHIC] [TIFF OMITTED] T2236.008

    Mr. Mica. And I now recognize the gentleman from Georgia, 
Mr. Barr.
    Mr. Barr. Thank you, Mr. Chairman. I appreciate very much 
the chairman convening these hearings today. One wishes that 
there was as much interest on the part of the administration as 
there is on the part of this subcommittee and the committee 
chaired by the distinguished gentleman from Indiana. I think 
this is a very, very critical issue for the United States of 
America and for Panama that attention be paid to our continuing 
relationship, our continuing relationship between the United 
States and Panama and with particular emphasis on mutual 
security matters and our mutual interest between our two 
governments and peoples regarding our efforts to attack the 
problems of drug trafficking, money laundering, and 
narcoterrorism.
    As Chairman Burton has already pointed out, there is going 
to be an increasing problem with the narcoterrorists in the 
wake, I believe, of the complete United States pull-out from 
the former Panama Canal Zone. We've already seen signs of that 
with increased guerilla activity in the regions between--
bordering between Colombia and Panama.
    General Serrano was just up here last week, a very, very 
distinguished Colombian, who has expressed on numerous 
occasions his grave concern about the deteriorating situation 
in that region and, in particular, in conjunction with the rise 
of narcoterrorists in his country of Colombia.
    I have travelled to Panama twice in the last 2 years. I 
lived there when I was in high school, and I know that our two 
countries have enjoyed, with some interruptions, but overall 
during the course of our joint history, a very, very warm and 
close relationship which continues today and, I believe, which 
will be strengthened by the victory by Ms. Moscoso in the 
elections over the weekend.
    I am concerned, though, with what appears to be a 
substantive, or a lack of substantive interest on the part of 
the administration with trying to work out a continuing 
relationship beneficial to and supported by the peoples of both 
of our countries with regard to perhaps some sort of mutual 
defense organization, some mutual narcotics control center or 
whatnot. I know that some of our other witnesses we'll be 
hearing from today, while in the private sector, have 
tremendous background in this area and have been speaking out 
on this issue.
    We had some hearings about a year ago over on the Senate 
side which apparently did not strike too much interest on the 
part of the administration. I have seen no tangible expressions 
of interest or activity on the part of this administration, 
which is particularly baffling in light of the continued 
importance of the canal to us, and particularly in light of the 
arrangements, some of which apparently are not made public but 
some of which have been made public between the Chinese 
Government through its commercial arms of COSCO and Hutchinson-
Wampoa to secure a foothold on both sides of the Panama Canal, 
and I believe that there are terms of that arrangement between 
Panama and Beijing that are contrary to the treaty of reversion 
between the United States and Panama which are of great concern 
to me. And I'd be very interested to hear today whether this is 
of any concern to the administration, as one would hope it 
would be.
    But Mr. Chairman, these are matters that weigh heavily on 
my mind, and I hope that through these hearings and other 
hearings, in the interest that I know is very genuine on the 
part of Chairman Burton as well and Chairman Gilman, we can, 
even though it's very late in the game, light some fire under 
the administration to try and impress with them and on them the 
importance of this region of the world and this particular 
facility to our commercial interests, our antinarcotics 
interest and our military interests.
    So I appreciate these hearings and look forward to the 
witnesses' testimony from both panels today.
    Mr. Mica. I thank the gentleman from Georgia, and at this 
time, I'd like to introduce our first panel. Our first panel is 
Ambassador Peter F. Romero, who is the Acting Assistant 
Secretary of the Bureau of Western Hemisphere Affairs in the 
Department of State, and then Ms. Ana Maria Salazar, who is the 
Deputy Assistant Secretary for Drug Enforcement Policy and 
Support in the Department of Defense.
    I'd like to welcome you both at this time and first say 
that this is an investigations and oversight subcommittee of 
Congress, and we do swear in our witnesses. So, if you would 
please stand and be sworn. Raise your right hands, please.
    [Witnesses sworn.]
    Mr. Mica. And the record reflects that the witnesses 
answered in the affirmative, and also, for your information, we 
try to--there are only two witnesses in this panel, so I don't 
think we'll use the clock, but we try to ask you to limit your 
oral presentations before the subcommittee to 5 minutes. We 
will take lengthy statements and without objection make them 
part of the record, and with those comments, I'd like to again 
welcome Ambassador Peter F. Romero and you are recognized, sir.

  STATEMENTS OF AMBASSADOR PETER F. ROMERO, ACTING ASSISTANT 
SECRETARY, BUREAU OF WESTERN HEMISPHERE AFFAIRS, DEPARTMENT OF 
STATE; AND ANA MARIA SALAZAR, DEPUTY ASSISTANT SECRETARY, DRUG 
     ENFORCEMENT POLICY AND SUPPORT, DEPARTMENT OF DEFENSE

    Mr. Romero. Thank you very much, Mr. Chairman, and I'd like 
to thank the members of the committee and Chairman Gilman and 
Chairman Burton for their comments. I welcome the opportunity 
to discuss with the subcommittee and the chairman the 
administration's efforts to retain a capacity to combat South 
American-based drug trafficking, following the cessation of air 
operations at Howard Air Force Base on May 1.
    I would like to spend a little bit of time in terms of how 
we got to where we are today with the Panamanians, and I'd like 
to mention at the outset that I and the administration support 
fully the chairman's statement, vis-a-vis concern about 
counternarcotics operations and counternarcotics or narcotics 
trafficking in the region.
    There were a number of other issues raised that I'd like to 
get to, and so what I would like to do is just keep my 
comments, my prepared comments as brief as possible and without 
any objection, Chairman, submit them for the record?
    Mr. Mica. Without objection, so ordered.
    Mr. Romero. Thank you, Mr. Chairman.
    How we arrived at where we are today--and perhaps I'll take 
a few questions on that afterward--administration efforts to 
preserve our access to facilities in Panama to support 
counternarcotics go back approximately 6 years. In January 
1993, the National Security Council approved the policy paper 
that said that the Secretary of State should be prepared to 
enter into negotiations with the Government of Panama regarding 
post-1999 base rights in Panama.
    In September 1995, Panamanian President Ernesto Perez 
Balladares met with President Clinton at the White House, and 
in a joint statement following the meeting, the two governments 
agreed to exploratory talks regarding United States military 
presence in Panama after 1999, with a view toward possible 
formal negotiations if exploratory talks appeared promising.
    By November 1995, the interagency working group had 
developed United States positions on the key issues, and then 
Secretary or Principal Deputy Assistant Secretary of State, 
Mike Skol, was prepared to engage the Panamanians on these 
exploratory talks to begin--to begin.
    The Panamanians then requested a postponement largely as a 
result of the fact that a United States military spokesman at 
the time had essentially talked about our no-rent policy for a 
post-1999--possible post-1999 military presence, and the 
Panamanians decided that that created a difficult atmosphere 
for them.
    But in order to prevent a loss of time, the State 
Department instructed our then-Ambassador William Hughes to 
engage the Panamanians, and he did just that. He had informal 
talks for several months. It made clear that the Panamanians 
were concerned about rent and other significant compensation 
and that these would be required for our continued access to 
any bases in Panama.
    In a Deputy's committee meeting in 1996, in May, it 
reaffirmed the quote, ``We will not pay rent or disguised rent 
or other direct compensation for the use of current U.S. 
military facilities after 1999.''
    In response, Perez Balladares, in a meeting with then or 
present Deputy Secretary of State Strobe Talbot, on the margins 
of the OAS General Assembly, put forward an offer centering on 
the idea of a multilateral counternarcotics center or an MCC. 
The MCC would be based at Howard. U.S. military would have 
rent-free access to the base. President Balladares called for 
stationing personnel from many other interested countries in 
the region at Howard to coordinate antinarcotics activities.
    The next month, the Department of State took the lead in an 
interagency effort to develop a concept paper to create an MCC 
along the lines of the Panamanian proposal. The MCC would have 
been a civilian institution with two main functions; one, an 
information directorate would coordinate the collection, 
analysis, and dissemination of information regarding drug 
trafficking and related crimes. A training institute would 
provide training in counternarcotics law enforcement and U.S. 
military personnel would have provided unique support to an MCC 
through specialized skills such as pilots, aircraft mechanics, 
radar and communications technicians, et cetera.
    We would have had continued access to Fort Kobbe, to 
include Howard Air Force Base and the pier facilities at Rodman 
Naval Station. Approximately, 2,500 U.S. personnel would have 
been stationed at the MCC.
    While the various interested agencies worked to develop a 
concept paper, Ambassador John Negroponte was named as a 
special post-1999 coordinator in September 1996 and began 
informally with his Panamanian counterpart, Ambassador Jorge 
Ritter, in November. The idea of MCC began to take shape in 
several informal meetings between the two, and quite frankly, 
in a blow to the process, Foreign Minister Gabriel Lewis, who 
had been a positive driving force behind the negotiations and a 
close adviser to President Balladares, died on December 19, 
1996.
    Nevertheless, the months of informal discussion led to a 
first, more formal phase. With the appointment of Ambassador 
McNamara, the negotiations began to advance. By December 1997, 
Perez Balladares, Panamanian President, announced agreement had 
been reached. In fact, we had reached essential agreement on 
key requirements, though certain provisions relating to 
privileges and immunities still needed to be worked out.
    Beyond using Howard as a platform for counternarcotics 
interdiction for a period of at least 12 years, those 
requirements--those requirements included its use for training, 
regional logistics, et cetera, search and rescue activities and 
other related missions as required. We insisted on these other 
activities because we could not otherwise justify the cost of 
maintaining the base itself and the personnel, equipment and 
resources necessary to do only counternarcotics at the base. 
When you look at the breakdown of the operations of the base, 
it is approximately $75 million a year just to operate.
    As a result of intense diplomatic efforts in December 1997 
and early in January 1998, Panamanian negotiators agreed to the 
terms of an acceptable text for an MCC. Ambassador McNamara 
traveled to Panama, fully expecting to initial a draft accord. 
Apparently, however, the issue had not or the accords had not 
yet been fully vetted internally within the Government of 
Panama, but particularly within the ruling Democratic 
revolutionary party of Panama, and the Panamanian Government 
declined to initial the agreement.
    At this point, we were still hopeful that the Panamanians 
would recognize how beneficial an agreement would be to them. 
Ultimately, the administration of Perez Balladares was unable 
to achieve a consensus among its own political supporters 
within the PRD party and requested significant modifications to 
the original draft.
    In March 1998, the Government of Panama tabled its proposed 
modifications. At that point we realized it would be 
exceedingly difficult to meet them. Among the most onerous of 
the changes sought were the insistence that no missions other 
than counternarcotics could be carried out at Howard, a 
rollback of quality-of-life provisions that they had previously 
agreed upon for our personnel and their families and, most 
importantly, a time limit of 3 years on guaranteed U.S. access. 
Remember, this versus 12 years in the agreement we thought we 
were ready to initial with the Panamanians. Any of these 
positions alone would have been a deal stopper. We took the 
position that changes of a genuinely technical character were 
possible, but stated clearly we would not, in effect, 
renegotiate the whole agreement.
    At about that time, President Balladares became 
increasingly focused on preparations for an August 30th 
referendum of a constitutional amendment which would have 
allowed him to run for a second term. His party became sharply 
polarized because of those strongly supporting and those 
implacably opposed to an MCC.
    The Panamanian side would not move off most of the 
unacceptable positions raised in March, and after the election 
referendum failed, and at the request of President Balladares, 
we issued a joint statement ending the MCC negotiations on 
September 24, 1999.
    In essence, our needs for a cost-effective presence, by 
which we mean one that----
    Mr. Mica. Sorry, sir, excuse me. You said September 1999?
    Mr. Romero. Correct, September 24, 1999--I'm sorry, 1998.
    Mr. Mica. Thank you.
    Mr. Romero. Excuse me.
    In essence, the essential problem was the cost-effective 
presence. Without having more than a guaranteed presence of 3 
years, not being able to conduct any missions out of Howard 
other than counternarcotics, along with other issues, quality 
of life, et cetera, we believe that we were just too far apart 
to continue negotiations with the Perez Balladares government.
    Before the ink was dry on a joint statement, the Department 
of State initiated an effort to obtain alternative arrangements 
in the region. The idea was to keep or perhaps increase the 
level of counternarcotics coverage in the region in a cost-
effective way. We decided the best way to do this was obtain 
rights to use existing facilities as platforms in the regions. 
To do so would allow us to save on the high cost of maintaining 
a fixed base or bases while enjoying hopefully the same level 
of coverage. Ideally, if enough of these facilities, called 
forward operating locations or FOLs, were identified in 
strategic locations, our coverage could even improve.
    Under a DOD/SOUTHCOM plan, operational/logistic support to 
the aerial counternarcotics missions by several USG agencies, 
to include DOD, DEA, Coast Guard, and Customs, would be 
maintained by having authorized access to and the use of 
existing and improved airport facilities in selected countries. 
DOD/SOUTHCOM identified primary FOL sites to be Manta, the 
Netherlands Antilles, Curacao, and Aruba. Additional FOL sites, 
as conditions warranted and as funding permitted, were to be 
explored.
    In February 1999, at DOD's request, with interagency 
support, a Department of State special negotiator and an 
interagency team began negotiations with the Kingdom of the 
Netherlands and the Government of Ecuador. Interim agreements 
were concluded with Ecuador on April 1st and with the 
Netherlands on April 13th, well ahead of the May 1st target 
date for closure of Howard.
    These interim agreements form the foundation for more 
detailed, longer-term agreements that will permit the 
expenditure of USG funds, upgrading certain airport facilities 
to enable them to accommodate monitoring--counternarcotics 
monitoring effort. The stationing of 8 to 15 permanent U.S. 
Government or contract person- 
nel at each site is planned with the temporary influx of up to 
300 crewmen and support personnel accompanying U.S. aircraft. 
We expect to have long-term FOL agreements negotiated before 
the interim agreements expire--Ecuador's on September 30th this 
year and the Netherlands on April 13, 2000.
    I should stress at this point that the FOLs are not 
military bases or a form of an MCC. They represent the 
deployment of limited numbers of U.S. personnel, equipment and 
aircraft to host government-controlled airfields for the sole 
purpose of supporting aerial counternarcotics missions. These 
operations are multinational in scope, requiring the 
cooperation of other nations in the region as envisioned by the 
hemisphere's Presidents at the Summit of the Americas in 
Santiago last year and at the U.N. Counternarcotics Conference 
in New York last June.
    Members of the committee, that's where we stand today in 
our effort to maintain counternarcotics activities in the 
region and in the absence of Howard Air Force Base. Obviously, 
there's an entire spectrum of other counternarcotics activity 
carried out by the United States--by us in the region that did 
not rely on the existence of Howard Air Force Base in the past, 
and those will continue now that Howard Air Force Base has 
closed.
    I'd be glad to entertain any questions you might have, Mr. 
Chairman, and what I'd like to do is wait in hopes that 
Congressman Chairman Burton will come back so that I could 
answer some of the questions that he posed to me. Thank you.
    [The prepared statement of Mr. Romero follows:]
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    Mr. Mica. Thank you. I think you'll have an opportunity to 
hear from Chairman Burton before the hearing's over. He will 
return. In the meantime, we will suspend questions until we've 
heard from our second witness, Ana Maria Salazar, Deputy 
Assistant Secretary for Drug Enforcement Policy and Support at 
DOD. Thank you for coming, and you're welcome and recognized.
    Ms. Salazar. Thank you, Mr. Chairman. And Mr. Chairman and 
distinguished members of the committee, despite the fact that I 
have been working on counterdrug operations and counterdrug 
policies for a number of years, this is actually the first time 
that I've had the opportunity to appear before a congressional 
committee, and I welcome this opportunity to testify before 
you. And I have a written statement that outlines in detail the 
Department of Defense counterdrug program. If you have no 
objections, Mr. Chairman, I would like to introduce it for the 
record.
    Mr. Mica. Without objection, that will be made part of the 
record.
    Ms. Salazar. Thank you, sir. And also if it's agreeable to 
you, I would like to use the time you have allocated for my 
oral statement to provide you an overview of the Department's 
plans to develop a new counterdrug theater architecture that 
will insure continued detection, monitoring, and tracking 
support.
    As you may know, and as you had stated, one of the most 
important aspects of this plan involves a series of 
strategically placed counterdrug forward operating locations, 
or FOLs, as stated by Ambassador Romero, around the hemisphere.
    I would like to conclude my oral statement with the 
description of the FOL plan and an update of the status of our 
CD operations upon our departure of Howard Air Force Base, 
which was on May 1st.
    While there is no simple solution to America's drug 
problem, each day, Active Duty, Reserve, and National Guard 
soldiers, sailors, airmen, and Marines make vital contributions 
by supporting the five goals outlined by Director McCaffrey in 
the national drug control strategy.
    We have finite funds and resources, multiple national 
security missions to address and numerous requests for 
assistance. We try our best within the Department to prioritize 
the support to areas where capabilities will provide the 
highest impact on the drug threats.
    As you may know, Mr. Chairman, that the five goals outlined 
in the national drug control strategy are supported by the 
Department of Defense, and I'm going to briefly touch on the 
goals; but more importantly, I'll go into some detail on goal 
four and five, since this is where this new strategy will be 
reflected.
    Goal one which is--talks about the education of America's 
youth to reject illegal drugs as well as the use of alcohol and 
tobacco. Actually, the Department of Defense has a very small 
program and puts very little funding into this goal, but I went 
and did some research, and we actually have some type of 
support for different--for--in the different States represented 
by the members of this committee, and it basically supports 
programs, mostly by the National Guard, within their 
communities, and they're mostly outreach programs.
    Under goal two, which talks about the increase of the 
safety of America's citizens by substantially reducing drug-
related crime, it is under this goal that the Department of 
Defense provides most of its law enforcement support, and we 
provide support--this is not--we provide support that includes, 
for example, translation for Federal and local law enforcement 
that require translators for either transcripts or they have 
certain organized crime in their--in their--within their region 
that require assistance. We provide supports to the HIDAs. We 
provide excess equipment to both local and Federal law 
enforcement. And more importantly, under this goal we've been 
able to support extensive training of both local and State law 
enforcement under a number of training programs, and which has 
resulted in the training last year alone of 70,000 law 
enforcement individuals.
    Goal three, I would like to touch very briefly, but I 
believe it's one of those goals and one of those success 
stories--unsung success stories by the Department of Defense. 
It is under this goal where we support the reduction of drug 
use within the Department of Defense in the civilians that work 
within the Department of Defense and the services. This policy 
has resulted in a dramatic decline between 1980 of where we had 
approximately 30 percent of the services using, or we believe 
that they were using drugs within the last 30 days, and now, we 
have a result reduction in 1998 of 3 percent.
    Goal four and goal five, as I'd mentioned before, this is 
where we reflect more of how we're going to develop this new 
counterdrug strategy in the region.
    Goal four addresses the importance of shielding America's 
air, land, and sea frontiers from the drug threat. The 
Department will spend $444 million alone under this goal, and 
what we seek is to deny air and maritime cocaine smuggling in 
the transit zone between South America and the United States 
border. Within the United States, the Continental United 
States, the focus of the support will go to the southwest 
border.
    As the lead Federal agency for the detection and monitoring 
of illegal drug shipments to the United States, DOD continues 
to employ a comprehensive air and maritime detection and 
monitoring capability, despite the fact that we are leaving 
Panama. Among the assets that DOD counts, which includes the 
operation of two relocatable over-the-horizon radars--we call 
them ROTHRs--seven P-3 counterdrug upgrade aircraft, E-3's, E-
2's, F-16 fighters, Navy combatants, and three TAGOS radars 
which are picket ships that have been working in--particularly 
in the Caribbean.
    Goal five talks specifically of breaking foreign and 
domestic drug sources of supply. It is under this goal that we 
provide much of the support that I think is especially apropos 
and very necessary for countries like Colombia, Peru, 
particularly those two countries. The department will spend, 
under this goal, $330 million in support of this goal.
    The priority for DOD in reducing the drug source of supply 
is focused on cocaine production and movement in Peru and in 
Colombia. The department continues to assist in enhancing these 
countries' efforts against the predominantly air transportation 
route by traffickers while also supporting them in countering 
the traffickers' use of rivers.
    Based on the threat concentration in Colombia, which 
remains a focal point at least from the Department of Defense's 
perspective, we have tried to greatly enhance the support to 
Colombia recently. And, if you wish, I can enter more detail of 
these programs if you wish, especially since Chairman Burton 
expressed interest to the type of support we are providing that 
country.
    A major portion of DOD source nation support is devoted to 
the use of assets for detection and monitoring and intelligence 
collection of the movement of cocaine and coca products within 
South America. Specifically, DOD supports source nations 
through such assets such as AWACs, E-2's, and other types of 
assets that both collect intelligence and provide information 
to host nations as to the types of illegal tracks that are 
flying through their air space.
    Last, and a very important part of this goal, is a third 
ROTHR that is planned for completion in January 2000 and will 
be located in Puerto Rico and will greatly increase the 
capability to detect and monitor air smuggling activity in the 
critical cocaine processing regions in both Colombia and Peru.
    Now, in regards to the restructuring of the theater 
counter-drug architecture, I have a couple of slides that I 
would like to present to you.
    The majority of DOD's interdiction in transit operations in 
the Americas, as I have described in goal four and goal five, 
were supported from United States military facilities in 
Panama, including over the 2,000 counterdrug flights per year 
originating from Howard Air Force Base. The counterdrug 
capabilities resident in Panama provided significant support to 
the efforts of United States Customs Services, the United 
States Coast Guard, Drug Enforcement, and, of course, the 
Department of Defense.
    As described by Ambassador Romero, the Panama Canal Treaty 
of 1977 mandated the withdrawal of United States military 
personnel from Panama and the reversion of all United States 
properties to Panamanian ownership by December 31, 1999, and 
without going very much in detail as to the reason why these 
negotiations failed, I will defer to the State Department for 
that.
    We clearly are in agreement with you, sir, and other 
members of the committee, that our departure from Panama does 
and has been and it will be an important--will have an 
important effect on our counterdrug operations, and we have 
been seeking a way to, I am not going to say go around it, but 
to find a solution to this problem.
    I have been DASD for almost 8 months, sir. A big portion of 
the time that I spend, and that my staff spends, is trying to 
find a way that we can find a solution that will offset the 
loss of the basing rights in Panama and maintain our current 
level of detection and monitoring support in the hemisphere and 
continue, more important, with our regional engagement. It has 
been difficult and we have been spending a lot of time and we 
believe that a number of important steps have been taken in 
order to find a solution.
    I was talking with SOUTHCOM's Commander, General Wilhelm 
yesterday. I was talking to him about how I was going to come 
and testify before a subcommittee, and in talking to General 
Wilhelm, he will tell you that he has seen a number of 
important steps that will allow us to reach the goal we are 
seeking so there will not be the degradation in the monitoring 
detection and, more important, in the engagement in the region 
that he believes is so important.
    [Slide shown.]
    Ms. Salazar. In this first slide, sir, I would like to give 
you a description as to how we reached the decisions to 
identify the FOLs and what we are trying to do. I know I don't 
have very much time, but the way we reached and we identified 
these FOLs had to do with a number of factors. One of them had 
to do with location, geography. Location, location, that was 
probably one of our most important priorities.
    One of the areas where we felt a weakness, perhaps since we 
were only flying out of Panama, is that we did not have, I 
would say, a semi-permanent presence in the source zone which, 
as you know and as you understand the threat in the region, was 
very important to us. We also understand that the Caribbean 
region, where 85 percent of the maritime threat is coming from, 
is also important. And we need to have some type of presence 
there.
    The other aspects we looked at was, for example, the 
political will of these countries to have some type of 
relationship on--this type of relationship with us on the 
counterdrug activities, force protection issues, and, more 
importantly, we also looked at the existing infrastructure.
    This FOL plan, what we are trying to develop or have with 
these FOLs is a system or the capability of supporting aviation 
operations 24 hours a day, 7 days a week.
    Specifically, any of the FOL sites should possess a 
suitable runway, sufficient ramp space, and an area for minor 
maintenance, refueling, servicing capability, necessary force 
protection, along with some basic services for support 
personnel and air crews temporarily assigned to there.
    As mentioned by Ambassador Romero, we are anticipating 
having a relatively small footprint, it would be 8 to 10 people 
would be permanently there. And depending on the assets that 
would be coming in and out, that could increase on a temporary 
basis up to 200 people.
    Seeking to maintain uninterrupted air coverage report and 
based on the above criteria that I have described to you, the 
Department of State negotiated interim FOL agreements with the 
Government of Ecuador so we would have access to Manta and the 
kingdom of the Netherlands so we would have access to Aruba and 
Curacao.
    I do think I would like to take this opportunity to thank 
those countries. Not only did they express the interests in 
working with us, but they literally were working, the 
negotiations teams were working 24 hours a day to ensure by May 
1st we would have the ability to work out of the FOLs, and we 
are very appreciative of both of these nations.
    Now, SOUTHCOM basically calculated the baseline in the 
following fashion: In order to establish a template or a 
baseline for coverage to select an FOL location, we looked at 
the average time on station that we had in fiscal year 1997 and 
fiscal year 1998. I say on station, because we are basically 
talking about the region within the source zone and the region 
within the transit zone.
    If we had been trying to perform these operations either 
from ``Rosy Roads'' in Puerto Rico or other parts of the United 
States, you would see that a majority of the flight time would 
not have been over the source zone or the transit zone which we 
are interested in.
    I have to be honest with the committee, sir, we are going 
to have a degradation. This is not a surprise. We have been 
talking about this in one fashion. We are not going to have the 
100 percent coverage that we had in 1997, that we had in 1997 
and 1998.
    Based on the calculations done by SOUTHCOM and the 
parameters set, baselines set by SOUTHCOM, we expect in the 
short run, with two FOLs, the one we have identified here, more 
than approximately, or a little--it is going to be more than a 
20 percent degradation until the Aruba, Curacao, and Ecuador 
FOLs are fully operational. Once we provide the upgrades that 
these airports require, we will raise that coverage to 85 
percent by fiscal year 2000. By the year 2000, this is what we 
hope our AOR is going to look like with the two FOLs.
    Now, I would tell the traffickers that they should not get 
too much comfort out of this, because we expect to have a ROTHR 
functioning by the end of the year, and the ROTHR, in support 
with the two FOLs, will allow us to be able to identify tracks 
that will be coming up through the source zone region.
    Mr. Mica. As you begin to conclude, could you tell us today 
what percentage of coverage today, this day----
    Ms. Salazar. Right now, as of today, sir, I can give you a 
description of the flights that were coming out. I am kind of 
looking at my experts. I would say 50 percent right now. As of 
right now, today, Customs is flying out of Aruba as of a day 
ago. We are expecting the F-16's to be flying out of Curacao as 
of May 6th. We expect Navy P-3's to be flying out of Manta as 
of May 12th. So, to be honest with you, we are talking, as of 
right now, I would say 50 percent.
    Mr. Mica. Do you have another slide?
    Ms. Salazar. Yes.
    [Slide shown.]
    Ms. Salazar. The next slide kind of fills the picture. We 
are in the need of a third forward operating location within 
the Central America region. We are right now in discussions 
with a number of countries who have expressed interest in 
reaching some type of agreement with us. Nothing has been 
signed. A lot of these countries--there is nothing definite. 
But we have looked at setting some site assessments before 
reaching this agreement. We at least want to have a good idea 
as to what is actually available in terms of airports.
    Once we reach an agreement with a Central American FOL and 
once we have done the necessary upgrades, we believe that by 
fiscal year 2001, I think is being realistic, we will have a 
coverage of up to 110 percent. The reason we would have perhaps 
a better coverage than we had in Panama is this FOL right now 
here. We would actually have a presence within the source zone, 
which, as you know, sir, for us is the focal point of where 
most of the problem is coming from.
    Could we have the next slide, please.
    [Slide shown.]
    Ms. Salazar. There is a number of things that need to take 
place before we reach this 110 percent, including an area where 
we are seeking your help and your assistance. We have, as you 
can imagine--we did not program within our budget the--we did 
not establish within our budget this plan. We expected to be in 
Panama right now.
    In fact, we were talking about being in Panama as of 
August. When September hit, when we realized we were going to 
have a problem in being able to support the programs for fiscal 
year 1999, we went up to the department and the department 
provided us the necessary funding, although we have right now 
before you a reprogramming package that requires action.
    The packet has been--the packet is being considered, but 
due to the other activities that are taking place right now, 
they have not been able to look at it. We are concerned that a 
number of our counterdrug operations, especially coming out 
from SOUTHCOM, are going to be affected, and our ability to 
come in and perform some of the TDYs that are necessary, some 
of the small type of maintenance and O&M required in the short-
term is not going to happen. So, sir, I request and we seek 
your help in this.
    The other very important issue that was mentioned by 
Ambassador Romero is the need to negotiate a long-term asset 
agreement with both Ecuador and the Kingdom of the Netherlands. 
We have started that process and we hope to conclude before the 
end of the year.
    The third and very important step that needs to be taken is 
not only identify, but basically negotiate a long-term 
agreement with the Central American FOL.
    The final and very also important step is the ability--
well, you know these FOLs will require upgrading and 
construction. For this we will require additional legislative 
authorities that the Department of Defense and my programs do 
not have at this moment in order to spend MILCON funds out of 
the CTA account, which is the account from which I work with.
    This construction would include, for example, runways, 
paving, ramp improvements, construction of operation buildings, 
aircraft hangers, aviation maintenance buildings, et cetera.
    I am going to conclude my remarks with that, sir. I look 
forward to answering your questions.
    [The prepared statement of Ms. Salazar follows:]
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    Mr. Mica. Thank you. I yield my time to the chairman of 
committee, Mr. Burton.
    Mr. Burton. Thank you. I will try to be brief. I have to 
get to another meeting.
    I was reading this global terrorism report that just came 
out this past month about the FARC and ELN guerrillas. 
Evidently the FARC commanders announced in March they would 
target United States military personnel assisting Colombian 
security forces. They have not acted on those threats as of yet 
and their heightened attacks against Colombian police and 
military bases did not target or incidentally kill or injure 
United States forces. But that threat was made in March, and I 
think we have to take it seriously.
    The activities of the ELN, it says they conduct weekly 
assaults on oil infrastructure, typically pipeline bombings, 
and they have inflicted massive oil spills, extortion and 
bombings against United States and other foreign businesses, 
especially the petroleum industry. They anually conduct several 
hundred kidnappings for profit, including foreign employees of 
large corporations.
    The FARC guerrillas engage in armed attacks against 
Colombian political, economic, military, and police targets. 
Many members pursued criminal activities, carrying out hundreds 
of kidnappings for profits. Foreign citizens are targets of 
FARC kidnappings, as well as documented ties to narcotics 
traffickers, principally through the provision of armed 
protection for coca and poppy cultivation and narcotics 
production facilities, as well as through attacks on government 
narcotics eradication efforts, and began in 1998 a bombing 
campaign against oil pipelines.
    These are terrorist organizations, according to this 
report.
    So my question to you, Mr. Romero, I presume the State 
Department still classifies FARC and the ELN as terrorist 
organizations. Is the State Department now willing to negotiate 
with terrorist groups?
    Mr. Romero. Chairman Burton, thank you for returning.
    First of all, let me say that I continue to be mystified, 
and perhaps you can tell me something that I don't know, in 
terms of your characterization of this contact as 
``negotiations.''
    You submitted a letter to the Secretary of State. We 
answered that letter in as complete a fashion as we possibly 
could. There were dozens of questions. In each of our dozens of 
answers, we started the sentence by saying this was not a 
negotiation. We offered in that letter to have your staff or 
yourself read the memorandum of conversation that was drafted 
from that conversation so that you would be able to determine 
for yourself that there was no negotiation that took place.
    I don't know whether your staff or whether you were able to 
do that.
    Mr. Burton. Why don't you just tell us what they talked 
about?
    Mr. Romero. Well, what they talked about--first of all let 
me just say that we responded to a Government of Colombia 
request to meet with the FARC guerrillas.
    Mr. Burton. What did you talk about?
    Mr. Romero. We talked, if I can show you a little bit, or 
give you a little bit of the sequence----
    Mr. Burton. I don't really care about the sequence. I want 
to know what you talked to the FARC guerrillas about.
    Mr. Romero. Well, as in our memorandum of conversation, our 
main concern and our main reason for talking to the guerrillas 
was to find out what happened to U.S. missionaries that had 
been missing for 6 years. We had tried through dozens of 
intermediaries that had contact with the FARC to find out what 
had happened to them in the intervening years, with no success 
whatsoever.
    Mr. Burton. Did you ask for their release?
    Mr. Romero. We asked for an accounting of where they are, 
and, if they were alive, a release, absolutely. This was the 
principal reason for sitting down and meeting with them.
    Mr. Burton. So you asked for the release of them after 6 
years. Now, what did they say?
    Mr. Romero. They said essentially what we had heard from 
intermediaries, that they had been taken by a group that was 
loosely affiliated with them somewhere around the border with 
Panama, that this group had since broken off its affiliation 
with them, and that they undertook to look into the possibility 
of getting us information as to where they might be and what 
their status might be.
    We told them--they told us that they would be willing to 
form a working group with us and the Colombian Government. We 
said no. We said no working groups. If they were affiliated 
with you, you could give us the essential information that 
would lead us to discover where they are and what their well-
being might be.
    Mr. Burton. You don't consider that negotiating with them?
    Mr. Romero. I do not consider that negotiation, Mr. 
Chairman.
    Mr. Burton. So you just went down there for informational 
purposes?
    Mr. Romero. We went down there to express to the FARC that 
if there was any support that we would lend to a peace process, 
that they had to have accounted for these American citizens. 
This was the primary and the principal reason for meeting with 
them. If you look at the memorandum of conversation, you will 
see very clearly that that was the major part of what we talked 
about with the FARC.
    Mr. Burton. Did you talk about alternative developmental 
aid?
    Mr. Romero. What we talked about was the nonnegotiability 
of our counternarcotics efforts as passed by Congress in its 
legislation last year, and that this would not be negotiable. 
This was a component of the conversation that the Government of 
Colombia wanted us to talk to them about, that if they impeded 
in any way counternarcotics operations, that the government 
could in no way enter into any agreement that would impede 
those operations, or suffer loss of United States aid. And the 
Government of Colombia wanted us to tell that to them, and we 
did.
    Mr. Burton. So you didn't talk about alternative 
developmental aid?
    Mr. Romero. Not to my knowledge, no. But our line on 
alternative development is that it cannot go to guerrillas in 
the absence of a peace agreement or the absence of significant 
movement toward a peace agreement.
    Mr. Burton. Did you talk at all about the ceding of land to 
their organization?
    Mr. Romero. No, that is not our call to make. That is the 
Government of Colombia. I don't know where you are getting 
this, Congressman.
    Mr. Burton. And there was no alternative development aid 
discussed?
    Mr. Romero. Not to my knowledge, no.
    Mr. Burton. You know, that is something that is interesting 
about this administration. Every time we have somebody before 
the committee, they don't say yes or no, they say ``not to my 
knowledge'' or ``I am not sure'' or ``I can't be positive''--I 
mean, as far as giving a straight answer, we don't get it.
    Now, who do we have to talk to to get a straight answer to 
find out about that?
    Mr. Romero. Mr. Chairman, if you will give me a second, I 
have got the memorandum of conversation here. It is classified. 
I would be happy to let you take a look it and read it outside 
of these proceedings, or, if you would like me to read it, I 
can read it over and characterize it in a nonclassified 
fashion.
    Mr. Burton. I don't want you to characterize it, because 
the semantics kind of lose us a little bit. What I would like 
to do is have a copy of it, we will read it and then we will 
get it back to you.
    Mr. Chairman, I see that my time is about to expire. I have 
a number of other questions. If I can get back here from my 
other meeting, I will try to get it on the second round. But in 
the meantime, I wish you would, Mr. Chairman, insist that we 
have a copy of that classified document so we can take a look 
at it.
    Mr. Mica. Without objection, I think that would be made 
available to you as chairman or members of the subcommittee or 
committee.
    Just in conclusion, I have a few moments left here. I am 
concerned about the pattern of coverage. I have a report from 
yesterday in Defense Weekly that actually says, I think General 
Wilhelm said it is less than 50 percent of the coverage 
employed in the region before 1990. Would you concur with that 
statement?
    Ms. Salazar. Are we talking as of today, right now, sir?
    Mr. Mica. Well, as of yesterday.
    Ms. Salazar. As of yesterday, that could be the case. We 
only have, as I described to you, a number of assets flying out 
of these FOLs right now at this moment, so that could be 
exactly right.
    Mr. Mica. Also, you presented to the committee a proposal 
for $45 million additional. That is on top of the $73 million 
in the proposal by the drug czar for this operation, is that 
correct?
    Ms. Salazar. That is correct. But that $43 million is 
coming from DOD.
    Mr. Mica. Where is that coming from specifically in the 
1999----
    Ms. Salazar. Reprogramming action?
    Mr. Mica. Yes.
    Ms. Salazar. I can get that answer for you, sir.
    [The information referred to follows:]
    [GRAPHIC] [TIFF OMITTED] T2236.024
    
    Mr. Mica. I think that is very important. The other quick 
last question, and I will cede to our ranking member, is Mr. 
Romero, you told me you broke off negotiations in September 
1998, is that correct?
    Mr. Romero. We announced the negotiations had concluded.
    Mr. Mica. I believe we were in Panama in February. Before 
that, we were notified that basically the administration had 
made a determination that we were being literally kicked out 
and that we were not going to negotiate further. There wasn't 
an opportunity for us to have a presence there. We didn't 
conclude these agreements until just recently, the interim 
agreements, is that correct?
    Mr. Romero. The interim agreements on the FOLs?
    Mr. Mica. Right.
    Mr. Romero. That is correct, April 1st and April 13th, I 
think, were the operative dates.
    Mr. Mica. And the Ecuador agreement expires this September?
    Mr. Romero. Correct.
    Mr. Mica. And we have a very unstable situation right now 
in Ecuador. Ecuador also requires some--may require some $200 
million additional.
    Ms. Salazar. We are getting differing accounts. $200 
million would be the top line of that. Right now we believe it 
is between $80 and $100.
    Mr. Mica. If we went to Aruba or Ecuador today, Curacao, 
Aruba, or Ecuador, how many folks would we find there, American 
personnel?
    Ms. Salazar. If you give me 2 seconds, I can probably 
count. There is a number of teams right now I think in all 
three sites. I can't give you the definite number.
    Mr. Mica. Can we get that number as of----
    Ms. Salazar. As of today, right now, yes.
    [The information referred to follows:]

    Curacao: 54; Aruba: 49; Manta: 0 *; Total: 103.

    * USN P-3 rehearsal April 30 to May 2, 1999, 1 aircraft and 
36 personnel. Additionally, a 40 person SATAF visited from May 
9 to May 23, 1999.

    Mr. Mica. But there would be very few folks there?
    Ms. Salazar. Depending on the classification of folks, we 
still have people doing assessment teams. We are going to have 
pilots. We have some maintenance. We have kind of a group of 
people in each one of the FOLs. What we can do is provide you a 
list of who is actually there today and what they are doing.
    Mr. Mica. Finally, who is flying out of each of those 
locations today?
    Ms. Salazar. I can get that.
    [The information referred to follows:]
    [GRAPHIC] [TIFF OMITTED] T2236.025
    
    Mr. Romero. Mr. Chairman, in the meantime, if I might 
address your issue of concern vis-a-vis Ecuador's stability, 
political stability. I think that for a long, long time, the 
Ecuador polity has been divided particularly as it relates to 
reform issues and the effects of international financial 
contagion and that sort of thing. They are on the cusp of 
reaching an agreement with the IMF. I think it will provide 
over half a billion dollars in relief. The country seems to be 
going back to a situation of greater normalcy.
    But in none of that was the relationship with the United 
States in any way threatened. I think most of the major 
political parties in Ecuador are very pro-United States and 
support Ecuador.
    Mr. Mica. The Senate held up the aid to Ecuador, I believe, 
in their bill, foreign aid.
    What concerns me, that is a very short-time interim 
agreement, and also we are looking at some substantial costs. 
First of all, the drug czar brought to us a $73 million price 
tag for moving this operation, just in this year's budget. You 
are bringing us today an additional $45 million. Then there is 
a possibility of another $200 million. So I think we have only 
seen the beginning of the cost to move this versus the option 
of possibly paying rent to stay where we were, which was 
precluded.
    Did you have the answer?
    Ms. Salazar. Sir, perhaps if you would allow me, what I 
could do, I think there is some confusion with the numbers, and 
in fact I am confusing myself.
    Mr. Mica. We would like to know the number of personnel as 
of the date of this hearing that are there in any capacity, and 
then the number of flights that took off today and each service 
that was involved or any operations. If you could provide that.
    Ms. Salazar. Yes, sir. If you would allow me, we could also 
provide a budget sheet that kind of outlines what the costs are 
going to be, at least as we have that.
    [The information referred to follows:]

    FY 99: $17.1 M; FY 00: $83.0 M; FY 01: $131.7 M; FY 02: 
$44.9 M; FY 03: $44.9 M.

     Figures include projected operating costs and 
projected construction costs.
     Construction will be undertaken in FY 00 and FY 
01, this accounts for large amounts for those two years 
relative to the rest.
     FY 02 and beyond assume steady state operations.

    Mr. Mica. I want to know specifically where the $45 million 
is coming from too.
    Ms. Salazar. Yes, sir.
    Mr. Mica. With those questions, I have many additional 
questions, but it is only fair now to yield my time to the 
ranking member.
    Mrs. Mink. Thank you, Mr. Chairman. The information that we 
have received today I find very distressing. The fact of the 
matter is from your testimony, Ambassador Romero, the 
government knew back in March of last year that there were 
difficulties in the negotiations and that there was a 
reasonable assumption that they could not be concluded 
satisfactorily.
    Then the negotiations were terminated in September. Yet we 
don't have any interim agreements for a takeover surveillance 
operation that would come anywhere near the capacity offered by 
our Panama installation until April of this year, let alone the 
absence of adequate budgetary arrangements. I find that very 
disconcerting in terms of any specific awareness on the part of 
both the Department of Defense and the State Department of the 
crucial nature of these activities.
    That is really the function of this subcommittee. It is 
probably easy to make observations after the fact, but that is 
really what an oversight is, to try to examine what happened 
and to try to raise some questions as to future decisionmaking.
    It seems to me that the close down of operations or 
negotiations by the State Department last March or September 
was extremely precipitous. If, as I understand the Ambassador's 
statement, it was largely on the basis that the 12 year 
agreement suddenly collapsed to a 3 year agreement.
    Given the fact that the interim arrangements you now have 
for the two or three FOLs is only for a very short period of 
time not to come up to speed until the year 2001, what would 
have been--and this is a question to both of you, what would 
have been the jeopardy of seriously taking the 3-year reduced 
agreement so that our facilities at Howard Air Force Base could 
have been maintained while at the same time giving our 
government greater latitude and time to develop substitute 
operations if the 3-year period went by without a long term 
multiple international narcotic center being fully established?
    I think that is a very commonsense sort of inquiry that 
most people listening to the testimony would come to. So I put 
that question to both of you.
    Mr. Romero. Congresswoman Mink, let me just make one 
correction. I regret if I meant to imply that things stopped or 
ground to a halt a year ago last March and that there was 
nothing done between that and September.
    Quite frankly, what happened in the interim period was that 
we were talking to the Panamanians, trying to get them to move 
off of the insistence on 3 years, hoping that we would be able 
to make progress there and also on other issues.
    We waited until August because there was a hope that if 
President Perez Balladares would have won the referendum and 
been able to run for a second term, that he would be able to 
rethink the position on duration and also on other missions, 
and in hopes that winning that would give him----
    Mrs. Mink. My point is not the rethinking of the 3 years to 
a longer period, but why the 3 years was unacceptable? I mean, 
I think you have to go to the final point and really make a 
judgment as to whether you wanted to conclude negotiations 
because the 3 years was unsatisfactory, when within the 3 year 
period, you could have laid the foundation for a stronger 
development of an alternative policy which we apparently do not 
have and will not have in place until the year 2001.
    It might not have been a final agreement, but neither is 12 
years; 12 years will come very quickly. So what was wrong with 
3 years? I guess that is my question, given the fact that we 
were ill-prepared to have a complete shutdown on May 1st?
    Ms. Salazar. Can I just add to Ambassador Romero's comment?
    I guess one of the concerns was that the amount of 
resources and upgrading that would require even with the MCC, 
was troublesome to put that investment if we were only going to 
be in Panama for 3 years. And, in fact, I know I was not part 
of the Department of Defense at the time, but it was my 
understanding there was conversations with the Hill and with a 
number of people and there was concerns that if we were going 
to make that investment, that the bottom line should, among the 
others, should be at least 10 years.
    Now, you are absolutely right, Congresswoman Mink, the 
short-term agreements and the interim agreements are only 
interim as we develop a long-term agreement. We are going to 
have to find a number that allows us to justify before you all 
the investments in infrastructure we are going to make. It is 
my sense that if we returned with an FOL agreement that 
basically allows us only assurances of being in these FOLs for 
3 years, and then we kind of request the amount of money we are 
going to need in order to upgrade them, there would be a lot of 
questions.
    So in part it has to do with the investment and the amount 
of money we put in the upgrades and the risk you run that you 
are only going to be there for 3 years.
    Mrs. Mink. What was the cost that you were working with in 
terms of setting up an MCC in Howard Air Force Base, and why 
the 3-year stipulation made that investment of cost 
unreasonable?
    Ms. Salazar. I will find out for you. I think some of the 
costs had to do with DOD. I believe it had to do with some of 
the other agencies. But we will provide you that number.
    Mrs. Mink. Would you then note the comparative costs of the 
establishment of the FOLs as now contemplated in your forward 
plan for subsequent years so we could see a comparison between 
the two?
    Thank you, Mr. Chairman.
    Mr. Mica. I thank the gentlelady. We will have additional 
questions to submit to both of you.
    I recognize now the gentleman from Georgia.
    Mr. Barr. Thank you. Thank you, Mr. Chairman.
    Mr. Ambassador, today's Panama-America is reporting that 
our Ambassador, Mr. Ferro, has publicly ruled out negotiating a 
continued United States troop presence or antidrug center with 
the President-elect.
    Are those press reports accurate?
    Mr. Romero. I think that the chances are fairly remote. We 
have already closed down Howard. We had a window of opportunity 
before that drawdown started. The Air Force tells us that now 
they have drawed down, it would be exceedingly more difficult, 
particularly if you were to begin negotiations now, to draw 
back up again. Then you have got issues related, I am told, to 
deferred maintenance and other upgrades that would be necessary 
to put Howard back on a good footing.
    Besides that, there is no indication that the new 
President-elect would be willing to address the issue. In fact, 
I have got a quote here from her that basically says, this is 
public, ``We do not want those bases in our country, as of 
December 31, they are finished.'' This might be campaign 
rhetoric.
    Mr. Barr. It may be. So what you are saying is the United 
States has ruled out negotiating any continuing presence in 
Panama with the President-elect.
    Mr. Romero. Congressman Barr, I wouldn't rule it out. What 
I meant to say was that we have no programs. We wouldn't rule 
anything out, but we have no plans currently.
    Mr. Barr. Are the press reports accurate or inaccurate?
    Mr. Romero. The press reports about Ambassador Simon's 
remarks, I can't tell you without reading them myself, but I 
can say that we have no plans to engage in them.
    Mr. Barr. Let me pose it this way: If, in fact, there are 
press reports in Panama that our Ambassador has publicly ruled 
out any negotiation concerning a continued United States 
presence, would those press reports be accurate or inaccurate?
    Mr. Romero. I suppose they would be, if that is what the 
press reported.
    Mr. Barr. Would be what?
    Mr. Romero. Would be accurate.
    Mr. Barr. Accurate. It is my impression that the President-
elect has said that she does favor some sort of at least joint 
programs and joint operations with the United States. Is that 
your understanding as well?
    Mr. Romero. I don't know that, Congressman, Barr. I would 
hope that that would be the case.
    Mr. Barr. What has been the substance of our government's 
negotiations or discussions with Ms. Moscoso on these matters?
    Mr. Romero. I don't think we have negotiated with her. I 
think she was apprised with the negotiations as they were 
related by the Perez Balladares government. I believe our 
embassy has had discussions generally, but I don't believe they 
have had them exclusively on this point.
    Mr. Barr. Well, it doesn't matter, I am not asking whether 
they have sat down and talked exclusively about something or 
not.
    What I am wondering is, has our government engaged in any 
form of discussions, official or--I presume they would be 
official--with the President-elect concerning the nature of any 
continuing relationship between the United States and Panama 
concerning joint operations, joint presence, and so forth?
    Mr. Romero. Not to my knowledge, no.
    Mr. Barr. Do we just not do that as a matter of policy with 
a Presidential candidate that might be in a position to assume 
the leadership of a country?
    Mr. Romero. I think that for the purposes of the State 
Department acting as an agent for the Department of Defense in 
these negotiations, essentially what we are told is once Howard 
closed down, it would be too late for the base to be 
rejuvenated without a significant increase in funds to get it 
there and that 3 years was not sufficient to go to the 
committees up here on the Hill to make that kind of case in 
terms of taxpayer dollars.
    That is essentially where we are.
    Mr. Barr. Well, we are talking about expenditures of money 
here somewhere along the line. I share the ranking member's 
mystification at why we didn't have some contingency planks.
    When I was last down in Panama very early in 1998, there 
were very clear indications at that time that there were 
problems in the negotiations, and yet here we are in May 1999 
still sort of floundering around, looking for something that 
might give us some sort of presence down there.
    With all due respect to whoever made up these charts, Ms. 
Salazar, they are absolutely meaningless. You have red arrows 
shooting all over the place. You have circles all over the 
place. That means absolutely nothing because there is no 
information on them.
    I mean, if you say well, we are T2 plus S2 or something 
equals 100 percent and we are at 50 percent or what not, I have 
no idea what you are talking about with those. There are no 
figures up there. There isn't even a radius. That is silly. I 
think it is insulting to come forward with that kind of 
silliness.
    What do those mean? How many planes are up? How many planes 
are operational? Are the P-3's, which you sort of glossed over, 
did they have the adequate hardware? It is my understanding 
that they don't, that they don't have the AIP upgrades, for 
example. F-16's, that sounds sexy when you talk about F-16's, 
but that isn't really what we need down there.
    We need the P-3's, we need the on-ground presence. What is 
the cost of these? It is my impression the per diem cost of 
housing our officials in some of these areas is three or four 
times what it costs to house them at Howard.
    We have estimates of simply the cost for the initial 
upgrades and repairs ranging anywhere from $78 million to $125 
million, and yet we say oh, we can't do anything with Howard 
because it would cost money.
    I mean, to me, to be honest with you, I think you all were 
looking for a reason not to move forward with this. There is a 
statement, Ms. Salazar, in your prepared remarks that the lack 
of political support by Panama is the reason for this.
    It is my impression that there is very, very substantial 
political support in Panama for continuing some sort of joint 
presence down there. If we simply rely on newspapers--and, I 
think, again we are just looking for an excuse. What is the 
Department of Defense's position, Ms. Salazar, with regard to 
negotiations with the President-elect? Have you all had any 
discussions with the President-elect or, again, is this--we 
can't deal with the President-elect or whatnot?
    What is the position of the Department of Defense with 
regard to any sort of continuing negotiations to try and arrive 
at an arrangement where we could maintain some form of 
meaningful joint presence with the Panamanians? Are there any 
such negotiations? If not, why not? If there are, what is the 
nature of them?
    Ms. Salazar. Sir, the Department of Defense would not 
necessarily have conversations with Presidential candidates or 
now the President-elect. We would actually defer to the 
Department of State to do that.
    Mr. Barr. So there have been no negotiations, no 
discussions?
    Ms. Salazar. Not from DOD's position. But that would be the 
case regardless of--we just don't normally do that.
    But I would say that----
    Mr. Barr. You all just seem to be putting this thing back 
and forth.
    Ms. Salazar. No, sir.
    I think actually there would be perceived with a certain 
distrust if we had a high ranking DOD official in conversations 
with Presidential candidates.
    Mr. Barr. Distrust with who?
    Ms. Salazar. We normally defer those types of conversations 
to the Department of State.
    Mr. Barr. So the Department of State would be distrustful 
of DOD if you all sat down with some of the Panamanians and 
talked about these things?
    Ms. Salazar. No.
    Mr. Romero. Let me see if I can clarify here. These issues 
are highly candescent in Panama.
    Mr. Barr. Highly what?
    Mr. Romero. Highly explosive in Panama. To have entered 
into negotiations or discussions or what have you during the 
course of a political campaign would have made it probably even 
more difficult because they would have been the centerpiece of 
a political campaign. Certainly United States uniformed troops 
in Panama after the post-1999 handover of the canal would have 
been a major campaign issue.
    If indeed we do ultimately speak to the President-elect 
about this, and I would venture to say that she is not 
officially the President-elect, the elections were Sunday, 
today is Tuesday, the electoral tribunal has yet to be 
announced tomorrow morning.
    Mr. Barr. The universe of people we are talking about there 
is two. There are two Presidential candidates.
    Mr. Romero. Correct.
    Mr. Barr. One of those will be the President of Panama.
    Mr. Romero. And one will not; that is correct.
    Mr. Barr. It seems to me saying we can't talk with these 
people or whatnot, it just mystifies me, unless things have 
dramatically changed since I used to be in the executive branch 
where we drew up contingency plans, we talked with different 
people, we weren't constantly blindsided.
    Mr. Chairman, if I could just ask one final question in 
this round for Ms. Salazar, there is a lot of money that we 
have been talking about that would be necessary for these FOLs, 
whatever you all call them. How much would it cost to maintain 
some sort of presence at Howard along the same lines we are 
talking about trying to pick up through these other circles 
that you all had out there?
    Ms. Salazar. I would venture to say it probably would be 
similar, except that we would not require the infrastructure. 
Depending on what site, if we stayed at Howard, the 
infrastructure is existent, we would not need the upgrades.
    But I would venture to say we would still have to pay the O 
and M perhaps TDY, depending on what happens to some of the 
buildings. But I would venture it would be very similar to the 
O and M and some of the TDY we would be using for some of the 
other FOLs.
    Mr. Barr. The cost per day per crew would be substantially 
less at Howard.
    Ms. Salazar. It should be, if we had access to those 
buildings. I mean, without knowing and without speculating too 
much, I am not too sure if we had an FOL in Panama, the way 
programs you are suggesting, that we would have access to the 
buildings where they were staying as of right now. We may have 
to stay in hotels, the same way we are, at least initially, 
doing in Curacao, Aruba, and in Manta.
    Mr. Romero. One difference, Congressman Barr, is that we 
don't pay for the maintenance of any of these airstrips, where 
we would be paying approximately--I think we paid $75 million 
last year for the operation of Howard. We don't pay operation 
or maintenance costs.
    Mr. Barr. OK. Thank you, Mr. Chairman.
    Mr. Mica. A couple of quick questions, if I may.
    First of all, Mr. Romero, the missions that you discussed 
with Panama in negotiations, they were for multi-missions or 
just a drug presence?
    Mr. Romero. No, we had been discussing with the Panamanians 
multi-missions, to include humanitarian, disaster relief, 
search and rescue, logistic support to some of our other 
embassies, beyond counternarcotics.
    Mr. Mica. And that was one of their objections, and they 
agreed just to a presence as far as an antinarcotics effort, 
with no other missions; is that correct?
    Mr. Romero. It was a little bit more complicated than that, 
Mr. Chairman. We had allowed them the ultimate say on other 
than counternarcotic missions. In other words, the Panamanians 
could veto a mission or not. That was written into the 
agreement.
    Mr. Mica. If it had been just antinarcotics missions, they 
would have said OK?
    Mr. Romero. They would have agreed. That would have been 
one component that would have been agreeable.
    Mr. Mica. When we negotiated with Aruba and Ecuador, do we 
have a multi-mission agreement?
    Mr. Romero. No, counternarcotics.
    Mr. Mica. Only counternarcotics?
    Mr. Romero. Correct.
    Mr. Mica. So we really have achieved nothing except 
incredible potential costs to the taxpayers for the move and 
less coverage; is that correct?
    Mr. Romero. I am not so sure that it is a greater cost, 
Congressman. I think I would like to see the breakout here.
    Mr. Mica. We just were presented a $45 million price tag. 
The drug czar came before us, presented $73 million. There is a 
potential for $200 million. That isn't loose change, 
particularly when it takes away from the rest of our 
counternarcotics effort, or if we were putting in drug 
education. $400 million, half a billion, would go a long way in 
this whole effort.
    Would you put up the chart that showed the coverage, 
please.
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    Mr. Mica. Would the staff please--where is the chart. Would 
you give them copies of this. Mrs. Mink's staff over here, Mr. 
Gilman.
    This chart that I am showing here, I don't have a big one 
of it, but I provided that to you. Mrs. Mink, myself and others 
from the subcommittee went to Panama and--I am sorry, we went 
to Miami, met with SOUTHCOM folks there and were briefed and 
given this chart in February; isn't that right, Mrs. Mink?
    Mrs. Mink. Yes.
    Mr. Mica. We were, again, an oversight subcommittee of 
Congress trying to figure out where we are and what we are 
doing. This is back in February.
    We were told, and you can see it here, SOUTHCOM's 
estimation. First of all, where did this chart come from, the 
information from there?
    Ms. Salazar. This is actually a chart from Joint Staff, 
sir, which has been approved and is supported by SOUTHCOM.
    Mr. Mica. OK. Well, again, we were given this potential 
operation performance. Again, we see the current level at 100 
percent. We see with agency augment FOLs, May 1st would be 70 
percent. We are told today, at best, we are less than 50 
percent. Then with FOL Curacao, Equador, first of May 1999 with 
DOS, Department of State access, 80 percent. So we haven't met 
these estimates by SOUTHCOM; is that correct?
    Ms. Salazar. No, you are absolutely right, sir. I believe 
that when these slides were produced, these are from February, 
your trip in February; is that correct?
    Mr. Mica. Right.
    Ms. Salazar. There were some expectations that we would be 
able to conclude the negotiations of the FOLs, the interim 
negotiations, a number of weeks earlier. So the fact that we 
did not have the interim agreement until April 1st in a sense, 
I believe, is reflected in these charts. So our ability to come 
in with the teams the way we have in the last 2 weeks was 
affected by it.
    Mr. Mica. But we have a pretty serious gap in coverage that 
wasn't anticipated. Let me ask you a question. Relating to the 
negotiations, now, for some time, and I am trying to figure out 
who was sort of in charge of this. I get sort of conflicting 
reports. But the Department of State led the negotiations. That 
is correct?
    Ms. Salazar. That is correct.
    Mr. Mica. We knew they were going down the tubes. DOD, can 
DOD tell DOS how much lead time they would need?
    Ms. Salazar. Are we talking about the interim negotiations, 
sir?
    Mr. Mica. Well, we had a performance level that was 
projected in February.
    Ms. Salazar. Right.
    Mr. Mica. You don't open these bases overnight. I would 
imagine you are still scurrying to get personnel and equipment 
there; is that correct?
    Ms. Salazar. You are actually right. Yes, sir.
    Mr. Mica. But we knew about this in April. Is there a 
document that you provided to DOS to tell them how much lead 
time you would need to get equipment and personnel and start 
operating?
    Ms. Salazar. Sir, we knew actually earlier in the year the 
difficulties--the number of difficulties that this could 
potentially create in negotiating FOLs.
    Mr. Mica. Was there a document that said to move this 
equipment here, we need such-and-such lead time?
    Ms. Salazar. Yes.
    Mr. Mica. Can you get us a copy of that?
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    Ms. Salazar. Of course, sir. SOUTHCOM had produced some 
deadlines early last year as to what needed to happen in order 
to be able to fulfill the requirements that are outlined here.
    Mr. Mica. But State did not perform as far as being able to 
negotiate those interim agreements.
    Ms. Salazar. No, I would say in fairness to State, sir, we 
went and specifically requested that they appoint an FOL 
negotiator and it was a very--he has been excellent.
    Mr. Mica. When was that individual appointed?
    Ms. Salazar. That was some time, when, 3 months ago?
    Mr. Romero. About 3 months ago.
    Ms. Salazar. About 3 or 4 months ago. Within that time, 
they were able to negotiate relatively fast, I would say, in 
comparison to other types of negotiations.
    Mr. Mica. Because I think they just started in February or 
were starting around that period of time. One other, I am 
concerned about the information that has been given us in the 
past assuring us that things would be in place today.
    Ms. Salazar. Right.
    Mr. Mica. And we are not here to be bad guys.
    Ms. Salazar. I know.
    Mr. Mica. Our job is--the responsibility is to see that the 
surveillance, particularly in this counternarcotics effort is 
in place, cost effective, et cetera.
    What concerns me is, first, that what we were told has not 
taken place. It concerns me about the projections for the 
future, the situation with Ecuador, et cetera.
    Now I am very concerned about what has taken place in 
Panama. I was told, both publicly and confidentially, that the 
port tenders that were just recently awarded, one, I guess, to 
the Chinese majority interest. I guess the Chinese Army has an 
interest in one of those, but I was told that those tenders 
were corrupt. Do you have any knowledge, Mr. Romero? Are we 
getting information that that tender was corrupt?
    Mr. Romero. I think we spoke out about some deep doubts 
that we had during the time of the actual solicitation itself. 
It seemed to be more an auction as opposed to a transparent and 
aboveboard bidding process.
    Mr. Mica. OK. Not transparent.
    Well, we have Jose Castrillan Heneo, Colombian drug 
trafficker, who was taken to the United States last year, who 
helped finance President Ernesto Perez Balladares' campaign 
with hundreds of thousands of dollars, is starting to talk from 
a Florida prison in Tampa, not my district, but close by. And 
he has reportedly detailed corruption at the highest level of 
the Panamanian Government, including the Vice President's 
involvement in some corrupt actions and a host of others.
    I am concerned about the State Department following up on 
these allegations. I am concerned about the correct tender. I 
am concerned about Howard Air Force Base, 5,600 buildings, huge 
assets in the operation of a strategic canal that is 
responsible for a good percentage of the world's shipping, 
particularly in this hemisphere, now also falling into similar 
hands.
    Is the State Department concerned about this?
    Mr. Romero. Well, first of all, as part of the treaty, you 
have a commitment on the part of the Panamanians for the 
permanent neutrality of the canal.
    Mr. Mica. I am sorry?
    Mr. Romero. Permanent neutrality and safeguarding of the 
canal.
    Mr. Mica. Are you saying, if we had to, we could go back in 
there?
    Mr. Romero. What I am saying is they are obligated legally 
to safeguard the neutrality of that canal, in times of both war 
and peace, giving preference to U.S. vessels in transit.
    Mr. Mica. What about Howard Air Force Base now? That is up 
for grabs to the highest corrupt bidder?
    Mr. Romero. I am told that the Panamanian Government has no 
plans to continue that as an airstrip or a base.
    The Panamanians established an entity called ARI, and this 
is responsible for the sale and use of reverted properties from 
the canal, part from the canal operations, canal installations, 
per se. They've done a pretty good job in selling some of the 
smaller properties, the residences, some of the smaller 
warehouses, et cetera, but have not yet succeeded in doing much 
in terms of interesting large investors to invest in the area, 
and you see some of the buildings and facilities going to seed 
as a result of that.
    There's an enormous cost in maintaining these after they're 
turned over to the Panamanians. There's been excessive 
paperwork and----
    Mr. Mica. Finally, are we monitoring some of the strategic 
assets that we helped construct and maintain over the years, 
falling into hands that may cause a serious problem. Such as--I 
don't know what's going to happen with the port quite frankly, 
but there are some other strategic assets, this base, 
airstrips, camps.
    Mr. Romero. We continue to meet within the context of the 
intelligence community, and we are also looking at a number of 
things post-December 31, 1999, one including the threats to the 
canal, what we can do to support the Panamanians in standing up 
a good security force to secure the canal and working with 
other countries, et cetera, and that process is ongoing, Mr. 
Chairman.
    Mr. Mica. Yield to Mrs. Mink.
    Mrs. Mink. The question that the chairman asked, something 
that we were discussing earlier, and that is the nature of the 
negotiations with the Panamanians with reference to the 
extended or continued use of portions of Howard Air Force Base 
for the narcotics operations, and what both of us don't quite 
understand is who was making the policy, the process 
determinations, the final decisions as to whether the 
counterproposals from the Panamanian Government were acceptable 
or not? Was it the State Department or was it the Defense 
Department?
    Mr. Romero. As it related to cost-effectiveness, which is 
essentially what it all came down to, whether you're talking 
about duration or missions or whatever, it was the Department 
of Defense and the Air Force which had to make that call 
because they were the ones who had to go to the committee to 
ask for an appropriation.
    Mrs. Mink. Is there a memorandum to that effect, DOD and 
State Department, that we would be privileged to have a copy 
of?
    Mr. Romero. I'm not aware of one but we'll certainly look.
    Mrs. Mink. Thank you, Mr. Chairman.
    Mr. Mica. Thank you, and we will ask a question to receive 
that, if it is available. I'd like to yield now to the 
gentleman from New York.
    Mr. Gilman. Thank you, Mr. Chairman, for yielding. I regret 
I had to go to a leadership meeting and missed part of the 
testimony, but I was reviewing the testimony once again.
    Mr. Romero, will the President's special envoy to the 
Americas, Buddy McKay, be traveling to Panama shortly as 
reported in the Panamanian press?
    Mr. Romero. That's my understanding, Mr. Chairman.
    Mr. Gilman. And what will he be discussing with the 
Panamanians? Are there further negotiations underway?
    Mr. Romero. He will be going down there to meet with the 
Government of Panama, presumably the current President and to 
include the President-elect, and he will be speaking at the 
commencement ceremonies of my alma mater down there, Florida 
State University.
    Mr. Gilman. In your opinion, is there still some 
possibility of reopening these negotiations?
    Mr. Romero. In my opinion, Mr. Chairman, that would really 
depend on the cost-effectiveness of them. We've been told that 
the cost would, particularly as it related to such a short 
duration, not bear the kind of laugh test, if you will, in the 
committee up here given 3 years. Now, there might be a change 
of heart. We could look into it to see if there is, but the 
words of the President-elect during the campaign are not 
particularly encouraging.
    Mr. Gilman. Of course, right up to the campaign they were 
encouraging. They had all but agreed to sign the treaties and 
then I guess a few months beforehand they dropped out of the 
picture.
    Let me ask, maybe it's the Department of Defense that 
should answer this. With regard to cost discussions, the 
operating costs differential between P-3 operations in Lima, 
Peru, and Howard Air Force Base in Panama for November and 
December 1997 deployments came to $2,200 per day per 13-man 
crew of heavier costs in Peru as compared to Howard. This 
represents only the M&IE costs and not the added associated 
aircraft costs as they relate to flight hours. So if we were to 
assume an 8-day deployment, differential costs could climb to 
$17,000 per day over an 8-day deployment, and when projected at 
a yearly rate, assuming one deployment per month, a 
differential source to $211,000. So the total M&IE yearly 
budget for the P-3 program then becomes $960,000. So the 
differential represents about a 22 percent increase in the 
budget. Can you comment on that?
    Ms. Salazar. Yes, and perhaps I should apologize for not 
being clearer on that subject. What we're trying to create with 
the FOLs is something of a presence within the region. As you 
note--as you can note with the numbers you--as you suggest with 
the numbers, flying out of Peru is much more expensive than 
flying out of Howard, and the reason for that is we do not have 
a permanent presence in Peru. That means we don't have people 
who, on a regular basis, are providing maintenance. We don't 
have the infrastructure. It's just because it is not permanent 
simply is much more expensive.
    What we're trying to do with the FOLs is create that 
presence, that support that we were receiving in Howard for the 
CD assets within the FOLs. So, in fact, and it's something I 
did not mention during my testimony, we continue to fly out of 
a number of airports with CD assets around the region. It is 
more expensive, it's difficult and we have to request 
permission on ongoing bases as we go into these airports. With 
the FOLs, we will not have to do that. We will have a permanent 
presence. It will be cheaper than these temporary arrangements 
we have with these other airports.
    Mr. Gilman. Well, Ms. Salazar, the facilities in Ecuador 
and Manta, for example, will require substantial upgrades.
    Ms. Salazar. You're absolutely right, sir.
    Mr. Gilman. How much money is this going to cost and how 
much does that compare to the cost of staying in Panama?
    Ms. Salazar. Well, the difficulty of calculating the cost, 
at least from my perspective, is I look at it from a CD 
perspective. As you know, the Air Force--Howard Air Force Base 
was a multi-mission air base. The cost that I would be 
incurring within my budget would be exclusively counterdrugs. 
So when we look at the overall cost for Air Force--and I was in 
conversations with General Wilhelm last night as to how could 
we compare what he was paying for just Howard for our CD 
activities. He could not give me that number.
    Mr. Gilman. How much will it cost to improve the airport in 
Ecuador?
    Ms. Salazar. In Ecuador? We're talking about--I would say 
most of the upgrades will be for Manta, sir, and it could be up 
to--so when we're talking about the $70--between $80 and $100 
million, a lot of that will be for, for Ecuador.
    Mr. Gilman. $80 to $100 million?
    Ms. Salazar. No, no, I'm sorry. Approximately $40 million.
    Mr. Gilman. $40 million just to upgrade one of the 
airports?
    Current estimates have shown that about 75 percent of the 
heroin entering our Nation comes from Colombia and that's 
smuggled into the United States through three major ports of 
entry, one of which is New York City.
    Ms. Salazar. Correct.
    Mr. Gilman. In light of the fact that New York has been 
designated a high intensity----
    Ms. Salazar. Correct.
    Mr. Gilman [continuing]. Drug traffic area, can you explain 
why the National Guard has decided to cut the New York National 
Guard's counterdrug budget for fiscal year 2000 by some 
$400,000?
    Ms. Salazar. Sir, I'm going to look into that. I just spoke 
to the TAG about a week ago. I have actually a very--I've been 
developing a relationship with the different counterdrug 
programs within the country and one of them is New York, for 
the reasons that you specified. I am not aware that they were 
going to be cut. I will look into it.
    Mr. Gilman. I'd welcome that and I'd welcome your 
submitting a response to the committee.
    Ms. Salazar. Absolutely, sir.
    Mr. Gilman. Mr. Chairman, without objection, if that could 
be made part of the record.
    Ms. Salazar. Absolutely.
    Mr. Mica. Without objection.
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    [GRAPHIC] [TIFF OMITTED] T2236.030
    
    Mr. Gilman. And just one more question, Mr. Chairman. 
General Serrano of the CNP said, when we leave Panama it's 
going to be more drugs north to the United States and more arms 
south into the region. Do you share any of those concerns?
    Ms. Salazar. Sir, I had the benefit of knowing General 
Serrano when he was Colonel Serrano and had the opportunity to 
work with him when I was stationed in Colombia as judicial 
attache and we do have those concerns. The ability--our 
concerns as to the fall and the spillway that they've had in 
the different borders in the region has been a concern, not 
only that we've had now, but that we've had in prior years. So, 
some of the number of expressions that General Serrano has made 
lately about Panama, in many ways we do share.
    Mr. Gilman. Well, you know, with all of these cost 
considerations and with the need to do more, there's 
trafficking in that part of the world, it seems to me that the 
administration ought to take another crack at seeing if we can 
renegotiate this arrangement. We came that close to it once 
before, and it would seem that it'd be appropriate not to give 
up Howard and let it become jungle once again with all of these 
increased costs that you're going to have to embark upon to 
operate out of forward areas.
    I'd welcome your comment about what the possibilities are 
of moving in that direction, Mr. Romero--Ambassador Romero.
    Mr. Romero. Chairman Gilman, I'm not sure what the circuits 
would bear with the new Panamanian Government, but I will 
certainly take your sentiments back to the administration and 
we will discuss it.
    Mr. Gilman. We would welcome that, and Ms. Salazar.
    Ms. Salazar. Absolutely, sir, and for us Panama, regardless 
of what happens with Howard from the Department of Defense 
perspective, we understand and we know the importance of having 
a close engagement with that country. It's important to the 
department and it's important for the general counterdrug 
strategy.
    Mr. Gilman. Thank you. Thank you, Mr. Chairman, for bearing 
with me.
    Mr. Mica. I thank the gentleman from New York. I now 
recognize the gentleman of our full committee, Mr. Burton.
    Mr. Burton. Before you leave, Chairman Gilman, the costs 
that you just pointed out, the additional costs that are going 
to be involved, plus the locations that are going to not be as 
good as having something there at Howard, would certainly, I 
think, show that it's important to rethink that whole issue and 
try to renegotiate that. Money talks and baloney walks. It 
seems to me that we could make an offer to the Panamanians that 
would be fairly lucrative, helping their economy and keep that 
base there, and it would still be less costly than what these 
other locations would cost us.
    So I will be happy to join you, and maybe Chairman Mica and 
some of the Members of the Democrat side in drafting a letter 
to the State Department and the White House to ask them to try 
to renegotiate that issue.
    Mr. Gilman. Thank you, Mr. Burton. I look forward to 
working with you on that issue.
    Mr. Burton. Let me just ask you, both of you, how would the 
Panamanians, during a time of war, assuming everything proceeds 
on track, how would they be able to protect the neutrality of 
the canal?
    Mr. Romero. Well, I'm not so sure what the war scenario 
would be. It's kind of hard to answer that question in the 
abstract.
    Mr. Burton. You have the Chinese shipping company that's 
going to have bases at both ends, and there's a lot of people 
that are concerned about the long range problems that might be 
faced with China. I see you smiling a little bit about that, 
but I don't think it's a very humorous matter because the 
Chinese have a very large army. They now have nuclear 
technology they did not have before because of Los Alamos and 
Livermore, and they have rattled their sabers in the South 
China Sea, and they have given missiles, missile technology, to 
some of the people that do pose a problem over in that area of 
the world. The North Koreans have fired a rocket across into 
the Japanese Sea.
    And so, you don't know what might happen down the road, and 
so what I'm wondering is, the Panama canal has been under our 
military control since it was first constructed. Now, it's 
going to be under the Panamanian control. So I think it's a 
logical question to ask how would they be able to protect the 
canal and the neutrality of that canal so that shipping could 
go on from any source in the world if there was a conflict.
    Mr. Romero. Mr. Chairman, it's a legitimate question. It's 
an honest question and I wasn't smiling about the question. I 
think it's a very serious one that needs to be taken in 
consideration.
    What I was smiling about was the semantical difference 
similar to the one that we had on the word ``negotiations.'' 
What the Chinese--what the Chinese company Hutchinson has is a 
contract to run a port. It is not a base. A base is something 
exceedingly different, and it is a commercial contract. We 
expressed our disdain for the process in which it was awarded, 
when it was awarded, and all I can tell you is that we hope, in 
terms of the neutrality of the canal, to work closely with the 
Panamanian Government to set up a mechanism for them to gather 
information on threats, subsequent threats perhaps to the 
canal, for us to share information with them and to stand up a 
security force that's worthy and up to the task.
    Mr. Burton. Well, I've been down to the Panama Canal a 
couple of times and I've seen the locks and I've seen how 
narrow it is and I've seen how they have to constantly dredge 
it to make sure it's open so that shipping can go through 
there. It would be a very simple thing for the Chinese, in one 
of their ships coming into one of those harbors, to be able to 
close that operation down in a heartbeat. I think that's 
something that ought to be of concern to the United States 
militarily, as well as our State Department. I don't think 
there is an answer because I don't believe right now there's 
been enough thought given to how we could protect the canal in 
the event there was a crisis. The Panamanians simply aren't 
going to be equipped to do that. There's just--there's just no 
way without outside help. I don't think there is an answer to 
that question, but I wanted to see if you did have some idea.
    Now, let's get back to the matter of semantics. In January, 
we had a meeting here with Ambassador Leonard, whom I see out 
there in his nice yellow tie, looks very sharp today with his 
blue shirt, and Phil Chicola, and during that meeting, 
alternative development aid, we asked them about that and they 
said it was discussed with the FARC guerillas.
    Now, it surprises me that you say to your knowledge that 
wasn't discussed. Don't you talk to these folks?
    Mr. Romero. Mr. Chairman, I didn't have the cable in front 
of me, and I couldn't verify it, and I don't like to talk about 
things where I don't have absolute recall in terms of what was 
discussed.
    Mr. Burton. Do you now have the cable in front of you?
    Mr. Romero. No, I don't, because it was classified, and I 
took it away from the unclassified materials that we sent to 
you.
    Mr. Burton. I see. Well, in any event, according to your 
subordinates, your colleagues, that was discussed and when you 
start discussing alternative development aid with guerillas who 
have kidnapped and murdered American citizens and others, that 
is negotiation. Now, you can shake your head and say it isn't. 
It is. You're talking about something that they want in 
exchange for something that you want. So I think it's 
disingenuous for the State Department to come up here and tell 
us that there wasn't any negotiation, that it was just a 
meeting, because I think anybody that really is paying 
attention to what's going on knows that it was more than that.
    Now, we have been talking about screening, some people 
would say, since 1993 for someone to do something about these 
three ministers, men, who are down there, and it's fallen again 
and again on deaf ears, and now the State Department has 
started using David Mankin, Rich Tennenof, and Mark Rich as an 
excuse to negotiate with the terrorists and it kind of bothers 
me. I just don't know why we didn't start looking into ways to 
get those guys out a heck of a lot sooner and to use them as a 
tool for sitting down with the FARC terrorists who are working 
and protecting the narcotics cartel down there, the drug 
cartel. It just really, really bothers me and I think it 
bothers a lot of my colleagues.
    Now, it's my understanding that the Government of Colombia 
and the United States Department of Justice have four men in 
the pipeline to be extradited to the United States on, I 
believe, drug charges, and the only agency that's dragging its 
feet on these people being extradited, in my understanding, is 
the State Department. Is the reason that the State Department's 
dragging its feet on this issue is because the State does not 
want our neighbors to the south, Mexico, who refused to 
extradite anyone or work with us on any drug-related matters, 
to look bad by letting Colombia kind of beat them to the punch?
    Mr. Romero. Mr. Chairman, I'm completely mystified by the 
State Department's standing in the way of a request from the 
Department of Justice for extradition. I have not known of a 
case where this has happened before as it relates to Colombia 
and I will look into it.
    In terms of the record, Mr. Chairman, I would ask you, 
before you make a statement about us doing nothing on MTM 
missionaries until a meeting with the FARC, to come to the 
State Department and review the record. We have several years 
of trying to find out what happened to those missionaries and 
it's a matter of public record.
    Mr. Burton. Well, we'll have to review that public record. 
You know, Congressman Mica and myself and Congressman Gilman, 
we've all been trying to figure out a way to get those people 
out and to get an accounting for them and the cooperation from 
the State Department has been minimal at best, as far as I'm 
concerned, and you can ask my colleagues whether or not they 
concur.
    Why did we certify Mexico as a fully cooperating partner in 
the war on drugs when our top drug enforcement officer, Tom 
Constantine of the DEA, testified in front of this committee 
that he did not think Mexico was being cooperative?
    Mr. Romero. I think that it was the administration's 
concerted opinion with all of the agencies, to include the 
Department of Justice, that there had been significant progress 
in Mexico to warrant full certification, Mr. Chairman.
    Mr. Burton. So the administration disagrees with the head 
of DEA, Mr. Constantine?
    Mr. Romero. I'm not--I don't have his language in front of 
me, but if he did say that he didn't agree with certifying 
Mexico, then the administration disagreed with him.
    Mr. Burton. Well, he said he didn't think Mexico was being 
cooperative. They're very careful when they work for the 
administration to take issue with the President, but he said 
Mexico was not being cooperative and yet we did go ahead and 
support a continued relationship with them.
    Mr. Chairman, I think that concludes my questions. I would 
like to see, as I said before, the top secret confidential 
information that you said you had available for us.
    Mr. Barr. OK. Thank you, Mr. Chairman. There are police 
reports and intelligence reports that have been declassified, a 
number of which have been reported in the press in Colombia, 
going back a few years, that FARC maintains a presence, 
including base camps, north of the Colombian-Panamanian border. 
Are those accurate reports?
    Mr. Romero. I think they are, Congressman. You're talking 
about specifically the Darien area of southern Panama?
    Mr. Barr. That would be.
    What steps are we taking, if any, to monitor that situation 
and address it specifically?
    Mr. Romero. Through our ICITAP programs and other programs, 
we have supported the police in Panama, continued to provide 
some equipment and training for them. They, of course, 
abolished their military several years ago and have 
approximately two companies of police who are continually being 
trained in jungle warfare and who are deployed to the Darien 
region.
    Mr. Barr. From the standpoint, Ms. Salazar, of the 
Department of Defense, what is the Department of Defense doing 
with regard to the situation in the Darien region whereby, 
according to the reports, that apparently are accurate, the 
FARC is operating in Panama's territory?
    Ms. Salazar. Yes. As I mentioned earlier, the Department of 
Defense is not only concerned with the spillover effect that 
we've seen from the FARC into Panama but the spillover effect 
that we've seen in other borders that Colombia has with other 
countries. I believe Colombia's neighbors have expressed 
concern about this, and of course, from the Department of 
Defense perspective we're concerned.
    We don't have--since Panama doesn't have a military per se 
that we can have a bilateral relationship with in the way we 
have, for example, with Colombia, we don't have any specific 
programs of training and technical assistance. However----
    Mr. Barr. Have these been explored? Is there some legal 
prohibition on it?
    Ms. Salazar. No, no, sir. The way that Department of 
Defense programs works is that we, with our capabilities, our 
assets, expertise, support law enforcement. I think the way we 
address some of the concerns you're expressing is the type of 
bilateral relationship that we've set up with the Colombian 
military. It's a recent--I would say it's a new, bilateral 
relationship in the sense that we've set up a specific working 
group where we sit with the Colombian military and we directly 
address with them a number of programs in training and support 
that we can provide as Department of Defense.
    So, in so much the counterdrug program provides support to 
the Colombian military----
    Mr. Barr. I'm very well aware of this, the support we 
provide the Colombian military. What I'm asking about is 
Panama.
    Ms. Salazar. We don't have--I'm sorry, sir, we don't have 
at this moment any specific bilateral cooperation program from 
the Department of Defense with the Government of Panama.
    Mr. Barr. OK. Is anything along those lines being explored 
with the Guardia Nacionale?
    Ms. Salazar. No, but the way we could do it, if it was in 
the interest of the law enforcement--of United States law 
enforcement within Panama is that they would request from the 
Department of Defense some type of training and technical 
assistance for the Guardia Nacionale. It's possible, to answer 
your question.
    Mr. Romero. Let me--let me just, if I might add, as I 
mentioned, the military was disbanded. It was called the 
Guardia. Now, they have a national police, and we are doing a 
baseline study through the intelligence community that should 
be ready in the next couple of weeks which will hopefully give 
us a good baseline idea of what we're dealing with in terms of 
the threats and what we're dealing with with respect to 
Panamanian capabilities. From that, what we hope to do is to 
make certain offers to the new Panamanian Government in terms 
of training and equipment, hopefully to bring in other allied 
countries, Japan. I have spoken to the Japanese about this, I 
have spoken to the British about it and other major users of 
the canal so that we can all contribute to the continued 
security of the canal.
    Mr. Barr. OK. When will that be ready?
    Mr. Romero. I think we're talking about June, the study.
    Mr. Barr. OK. And we'd be transmitting a copy of that to 
the Hill so we can take--to this committee, subcommittee so we 
can----
    Mr. Romero. I will mention that to the national 
intelligence officer who is guiding that process, yes, sir.
    Mr. Barr. With regard to the facilities and the presence of 
China through Hutchinson-Wampoa on both sides of the Panama 
Canal, both ports, is there anything about the arrangements 
between the Panamanian Government and Hutchinson-Wampoa or 
COSCO or the Chinese Government or the Chinese military that is 
of concern to our government?
    Mr. Romero. I think what we see is a pretty straight 
commercial deal to run port facilities and that sort of thing. 
Certainly, these are pretty public in their nature, and we 
would, to the extent possible, insure that they would be run in 
an open and efficient way, but as far as we can tell, it's a 
straight commercial contract that is being operated on now by 
Hutchinson-Wampoa.
    Mr. Barr. So the U.S. Government has no concerns about 
these? Do they believe that they are entirely in accord with 
the 1977 treaty?
    Mr. Romero. Yes, sir.
    Mr. Barr. Reports in the press regarding certain powers 
that Panama may have arrived at with China and Hutchinson-
Wampoa notwithstanding to the contrary?
    Mr. Romero. I think there's been a lot of press speculation 
about what this might mean, but in real--with respect to the 
facts on the ground, there's very little that would suggest 
that this is anything other than a commercial deal.
    Mr. Barr. Well, we did have some concerns about the 
commercial aspect of it, at one time also, didn't we?
    Mr. Romero. We did.
    Mr. Barr. That there may have been some other payments 
made?
    Mr. Romero. I don't know about other payments, but it 
seemed that rather than a normal orderly process of submitting 
sealed bids, et cetera, that bids and the information from 
those bids seemed to be at least given to some bidders, and 
to--I think with the intention on the part of Panamanians who 
are running this to drive the bids up, and it resembled, I'm 
told, more of an auction than a transparent, efficient and 
aboveboard bidding process.
    Mr. Barr. Thank you. Ms. Salazar, does the Department of 
Defense have any concerns whatsoever with regard to the 
presence and the circumstances under which Hutchinson-Wampoa, 
and through them the Chinese, now maintain a presence on both 
ends of the Panama Canal? Does the Department of Defense have 
any concerns whatsoever about that?
    Ms. Salazar. Sir, I'm not aware of any concerns, but what I 
can do is, upon return to my office, I can talk to them.
    Mr. Barr. Would you not be aware of them if there were 
concerns?
    Ms. Salazar. Probably.
    Mr. Barr. Are there any concerns that the Department of 
Defense has with the relationship between Panama and the 
Chinese, specifically with regard to Chinese formal presence on 
both ends of the Panama Canal at this point?
    Ms. Salazar. I think so. As Ambassador Romero mentioned, 
there's a lot of speculations as to what will be the 
implications for the canal to have Panama increase their closer 
bilateral relationship.
    Mr. Barr. Certainly our policies are built on more than 
speculation. Is there--are there any concerns that the 
Department of Defense has?
    Ms. Salazar. Sir, not that I'm aware of right now, but like 
I said, I can come back----
    Mr. Barr. And if there were, you would be aware of them?
    Ms. Salazar. Probably, except I can't tell you 100 percent. 
I would prefer to leave a window up for me to return to you if 
there is some concerns.
    Mr. Barr. I mean, that's utterly unresponsive. On the one 
hand, you say you would be aware of them, and now you say 
you're not necessarily aware of them.
    Ms. Salazar. The reason why----
    Mr. Barr. I mean, there may be some national security 
concerns that the DOD has that may not be shared by the 
Department of State. I mean, are there any--do we have any 
military concerns about this?
    Ms. Salazar. I guess the reason why I'm so hesitant is, you 
have to understand, as Deputy Assistant Secretary for Drug 
Enforcement, my concerns are specifically counterdrug-related. 
I would--what I will do is approach the DASD that has the 
responsibility of Panama Canal, I guess, and Panama as a 
country and ask some questions, and I will also talk to the 
DASD that has responsibility over China, but as counterdrug 
supervisor, I would not necessarily receive that type of 
information.
    Mr. Barr. OK. Well, I understand that and if you would get 
back to me on that I would appreciate it.
    Ms. Salazar. Absolutely.
    [The information referred to follows:]

    I have discussed this issue with senior Department 
officials. The Department has found no hard evidence to suggest 
that China, through Hutchinson-Wampoa or any other firm, has 
the capability, the desire, or the wherewithal to seek to 
control the Panama Canal after its transfer to Panama on 31 
December 1999. In the judgment of our analysts Hutchinson-
Wampoa's motivations are strictly commercial, and existing 
Panamanian Law and Treaties provide the United States ample 
recourse to ensure that the Canal remains open and secure for 
world commerce.

    Mr. Barr. Just one final thing to followup on a question 
that I had previously with regard to the AIP upgrades for the 
P-3's. Are the P-3's we have in the region, including in the 
areas that you cited over here with the FOLs, are they upgraded 
sufficient to meet the needs, the drug threat and to monitor 
properly?
    Ms. Salazar. When you're talking about the P-3's you're 
talking about--I guess I'm not----
    Mr. Barr. I'm talking about the naval reserve and active 
duty P-3's.
    Ms. Salazar. I believe we do have an upgrade program with 
them. I could provide you more details of it, but I do believe 
we're trying to upgrade them. They're not sufficient.
    Mr. Barr. So they are not yet upgraded?
    Ms. Salazar. No, I believe not all of them.
    Mr. Barr. OK. Thank you. Mrs. Mink, did you have any final 
questions?
    Mrs. Mink. No questions.
    Mr. Barr. OK. We appreciate Mr. Romero and Ms. Salazar very 
much being with us today, sharing your thoughts and answering 
questions, and we would appreciate the followup materials that 
you all will be--Mr. Chairman.
    Mr. Gilman. Just one thing if I might do, could either of 
the panelists--is Panama without a military head or sufficient 
professional police who can handle the FARC along the Colombian 
border?
    Mr. Romero. Mr. Chairman, I'm not a counterinsurgency 
specialist, but the area is exceedingly remote. There are not a 
lot of transportation links to it. As you know, it's the area 
where the Panama or the Pan-American Highway is not complete. 
It's jungle, triple canopy, and while they operate there across 
the border and probably have some sites in Panama that they 
visit with great regularity, I haven't seen the intelligence 
community express alarm that somehow that could get translated 
into a threat that would move north or move toward the canal. 
It's been there for quite some time. We're working with the 
Panamanians to train them to better root it out, but I haven't 
seen any information analysis and what have you from the 
community that would suggest that it's growing or in the near 
to medium term could be constituted.
    Mr. Gilman. Ms. Salazar, do you want to comment?
    Ms. Salazar. I would actually have nothing more to answer.
    Mr. Gilman. Thank you, Mr. Chairman.
    Mr. Barr. Thank you, Mr. Chairman. We would also, without 
objection, leave the record open for 2 weeks for any additional 
questions that any member of the subcommittee might have to be 
submitted to you. Thank you very much, and we'd like to wish 
both of you well and look forward to seeing you again.
    Ms. Salazar. Thank you.
    Mr. Barr. Thank you. And as soon as Mr. Romero and Ms. 
Salazar leave, we'd like to invite our second panel forward, 
and while the transition is taking place, I would like to 
introduce Lieutenant General Gordon Sumner, retired. General 
Sumner served as chairman of the InterAmerican Defense force 
and also served as Ambassador at large for Latin American 
affairs. He's been studying, traveling in and writing about 
Latin America for over 30 years and is internationally renowned 
and recognized expert.
    We're also pleased to have Dr. Mark Falcoff with us here 
today. Dr. Falcoff is a resident scholar at the American 
Enterprise Institute [AEI]. He has authored numerous books and 
articles about Latin America, including the volume ``Panama's 
Canal: What Happens When the United States Gives a Small 
Country What it Wants.''
    We appreciate very much Dr. Falcoff and Lieutenant General 
Sumner being with us here today, and as both gentlemen are 
taking their seats, as the chairman indicated to the previous 
panel, this is an oversight hearing, and we, therefore, have 
all of our witnesses placed under oath. So, if you would, 
please, both Lieutenant General Sumner and Dr. Falcoff, raise 
your right hands--and Mr. Lyons, I didn't know you were going 
to be here.
    Mr. Lyons recently retired as the Drug Enforcement 
Administration's [DEA's], country attache in Bogota, Colombia, 
and also will be able to answer questions today and provide 
meaningful insight into some of the problems that we've already 
been discussing.
    [Witnesses sworn.]
    Mr. Barr. Thank you. If you will, be seated, and if the 
record would reflect that all three witnesses answered that 
question in the affirmative.
    If we could then, General Sumner, if you would like to make 
a brief oral statement and all the witnesses' remarks, if they 
do choose to submit written remarks, will be printed in their 
entirety in the record. General.

STATEMENTS OF LT. GENERAL GORDON SUMNER, U.S. ARMY (RET.); DR. 
 MARK FALCOFF, RESIDENT SCHOLAR, AMERICAN ENTERPRISE INSTITUTE 
    FOR PUBLIC POLICY RESEARCH; AND LARRY LYONS, FORMER DEA 
                   ATTACHE, BOGOTA, COLOMBIA

    General Sumner. Thank you very much, Mr. Chairman. I have a 
written statement which I would request be placed on the 
record.
    Mr. Barr. So ordered.
    General Sumner. But you know, sitting here I'll be 75 years 
old in July, and I fought in World War II, Korea, Vietnam, and 
it's deja vu. What we are seeing here is the disarming of 
America. America's been disarmed conventionally, disarmed from 
a nuclear standpoint as witness to what's going on up at Los 
Alamos, and our intelligence. They say we don't have any 
intelligence, we don't know what's going on. We're disarmed 
from an intelligence standpoint and, particularly, 
counterintelligence, and we have the moral disarmament which 
is--reflects directly on what we have here today, and the drug 
problem is part of this moral disarmament of the country.
    I really felt badly about Ambassador Romero and Secretary 
Salazar. I have served with Peter Romero, and I--you know, it 
appalls me that he has to be subpoenaed to be brought in here. 
It's just incredible, and the American people don't know what's 
going on.
    I surfed the Internet last night and I surfed the TV, and 
there's nothing about Panama. The American people should be 
worried about Panama, and I have a videotape to demonstrate 
that later on, but you know, we're sort of rolling over and 
playing dead here. The American people, if they want to see a 
catastrophe, economic catastrophe for this country, I'll show 
you what happens when we close the Panama Canal, and if I were 
a member of the FARC narcoterrorists, I would have that Panama 
Canal right in my sights, and Congressman Barr, you and I have 
been there. You know how fragile, you blow up the dam, it takes 
years to fill that, that dam with fresh water. The locks are 
very fragile.
    This whole thing, there's an unreality about it. The 
American people, instead of worrying about Y2K or Kosovo, they 
should be worried about the Panama Canal. Yet, I look in the 
paper this morning, there's absolutely nothing about it, and 
we're--those whom the gods would destroy they first make mad. 
Some of this is just unreal.
    I brought up the point about we're getting out, we can't 
reverse it. As a military person we can always reverse it. At 
11:59 p.m., on December 31, 1999, if the military is ordered to 
stay there, by God they'll stay. They follow orders, and if 
they have to dig latrines and live in tents, they'll stay 
there. This--you know, this is not irreversible.
    And what we've seen here is the left wing, the extreme left 
wing of the Democratic party in this country and the extreme 
left wing of the PRD in Panama being able to get together and 
insuring that these negotiations failed. Now, I talked to John 
Negroponte when he was the negotiator and he was sent to the 
table with an empty bag. A week later he quit after I talked to 
him, and you go down and you talk--you see what the--what Peter 
Romero went through--Ambassador Romero went through a long 
litany of the obfuscation. No matter what was being done out 
front, behind the scenes, there were people insuring that these 
negotiations would fail.
    My Panamanian friends, and as you know I spent a lot of 
time with Panamanians. Matter of fact I went down and supported 
Toro because Endara was such a big crook, the previous 
President, and he would be in jail if he didn't have a 
diplomatic immunity by being a member of the Central American 
Parliament. I thought we were going to get something better out 
of the President who's known as El Toro.
    But the mantra in Panama is always, hey, let's make a deal. 
I think the Panamanians would be delighted to see this thing 
worked out. Seventy-five percent of the Panamanian people want 
to see us stay, the United States and United States military, 
and I think if you took a poll amongst the American people, 
you'd find that the majority of the American people want us to 
keep some sort of a presence in Panama, and I'll show that on 
the tape here because of the economic realities, to say nothing 
about the drug and the military realities.
    We talked about cost-effectiveness. I went down, and I'm 
not Jessie Jackson, although when I heard this problem with 
getting the hostages out of Colombia, the State Department 
ought to be talking to Jessie Jackson, to send him down there, 
maybe he can get them out, but the strategy here has always 
been, look, we'll send drugs north and the guns will come 
south. Right now, we're seeing the Caribbean, and if you looked 
at that map over there that the Pentagon had up here, if I were 
a drug general I'd be delighted. I can run circles around that, 
and I can run through the seams. I mean, that's not going to do 
it.
    And you know, when we talk about the money, the hundreds of 
millions of dollars--now, I was in Panama and I talked to the 
foreign minister whose name, to protect the innocent, will 
remain unnamed, and he told me for $20 million we can get a 
deal. Let's make a deal. I came back and I talked to my 
Senator, Pete Domenici. You may have heard of him. He's Mr. 
Moneyman over on the Senate side, and Pete said, at $20 million 
that doesn't pass the ``so what'' test.
    So you know we, we're talking about this--we're talking 
about what we could have had for tens of millions of dollars. 
Now, we're talking about hundreds of millions of dollars to do 
something that won't do the job.
    Now, let me--because I know my time is limited--if they'd 
play the video over here, can they do that? Or did everybody--
all right.
    [Video shown.]
    Mr. Barr. General, if you're going to speak, you'll have to 
do it from the microphone I'm afraid.
    General Sumner. OK. I can do that.
    Mr. Barr. So the court reporter can pick it up.
    General Sumner. All right. The first part of this is 
narrated. This comes from Los Alamos National Laboratory. We 
put--the Department of Transportation put $800 million into 
putting up a national simulation of our transportation system, 
and the idea here--and I have a letter for Congressman Gilman 
and, I hope, Senator Helms to send to Secretary Cohen to feed 
the information from the canal into this national 
transportation system, and this shows our transportation 
system.
    It's only going to take a couple of minutes, but we cannot 
only show in macro terms but we can show it in very discrete 
terms, and you'll see in just a moment where we can take an 
individual truck and individual rail car and individual cargo 
and move it across the country, and you see going from Los 
Angeles to Alabama here, you see where we can take an 
individual cargo, move it across the country, keep track of it, 
and this is the dry canal. Now, here you see the cargo being 
moved and going across the country here, through Dallas, and 
you'll see that we can actually, with the pointer you'll see 
here in just a moment we can, we can track the individual 
cargo, and this is an $800,000 simulation, which if we feed the 
Panama canal information into it, will show, and here we have a 
pointer that's following the individual cargo across the 
country, that the--it's an amazing piece of work.
    I think the State Department has been and others have been 
saying, well, look, if the canal is closed, we have the dry 
canal. Well, the dry canal is full and there's no way when you 
take--40 percent of all the grain in this country goes through 
the canal, we're talking about hundreds of millions of tons. 
There's no way that this system can handle it, and it would 
be--if the canal were closed for 7 days, 15 days, 30 days, 60 
days or longer, it would be an absolute economic disaster for 
this country, and I don't think the American people understand 
that at all.
    And if I were the narcoterrorists, and here's the chart 
that shows the delays that we have built in here now, there's 
just no way that the country can deal with this, and the dry 
canal is an absolute phony argument in my estimation. That's 
the end, that's the end of the thing.
    I just wanted to bring that up. I think it's important for 
Congressman Gilman and Senator Helms to ask Secretary Cohen to 
do this. It costs about $500,000 to go ahead and take that 
information and feed it into it, into the national simulation 
here.
    I'd like to come back to Congresswoman Mink's point, you 
know, what we have been doing. This has been a wreck, a train 
wreck that we've seen for years, yet nothing has happened. Why? 
Because there is a--I think--you know, one thing that really 
amazes. We talk about defense and we talk about the State 
Department, where's the NSC in this? You know, and in my 
statement, you know, Sandy Berger, Secretary Albright, 
Secretary Cohen, these people are just not, they're not focused 
on anything in this hemisphere.
    And I call it Kosovo--Kosovo is the correct pronunciation--
Kosovo West. As we speak, the FARC is going in, killing the 
young men, recruiting the children, et cetera, and we have it 
right here on our doorstep, yet we're doing nothing about it, 
and you know, I think now is the time. With the new President 
down there, something should be done, and I think--I say it's 
never too late, and I think for the good of this country we've 
created a vacuum down there, and we'd better do something about 
it.
    And I see the red light is on, which means I've gone over 
my time, but I appreciate the opportunity to appear before the 
subcommittee, and incidentally, Bill Richardson sent me over to 
see Joe Ritter. They wanted me to go down and be the 
negotiator, and I volunteered to do it then, and I volunteer to 
do it now. Thank you very much.
    [The prepared statement of General Sumner follows:]
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    Mr. Barr. Thank you very much, General. Dr. Falcoff, if you 
have a brief statement.
    Mr. Falcoff. Yes, a very brief statement. Mr. Chairman and 
Congressman Gilman, it's a privilege to share the table here 
with a distinguished soldier and patriot, General Sumner.
    I want to talk a little bit about Panamanian politics 
because that's the thing that seems to have been missing from 
this hearing this morning. Criticisms have been launched 
against the administration. I don't happen to belong to the 
same political party as the administration, and maybe those 
criticisms are accurate ones insofar as its management of 
negotiations are concerned. I don't know. I'm a private citizen 
and an individual scholar, but I do know something about 
Panamanian politics, and I think it needs to be brought to the 
table here.
    I believe the basic reason why we have not been able to 
reach agreement is that as chief representative of the party of 
General Torrijos, President Perez Balladares could not be seen 
as betraying the latter's nationalist legacy by overturning key 
provisions of the treaty, namely, the ultra sensitive subject 
of U.S. troops. Perez Balladares tried to come up with a better 
mousetrap to circumvent this problem with the creation of the 
multilateral antinarcotics center.
    Throughout the period when we were negotiating or 
discussing this, I don't know how many hundreds of times 
President Perez Balladares told his people it wouldn't be a 
U.S. base, it wouldn't even be a military installation. Ninety 
percent of the people would be United States people, most of 
them would be uniformed, but they wouldn't be able to fly under 
the United States flag, they wouldn't be able to fly under the 
Panamanian flag. There'd be some kind of fictitious 
international personality that would govern this center.
    Even this didn't satisfy President Perez Balladares' 
critics, particularly the Arnulfistas and that's the party 
that's soon to govern Panama. It's the second largest in 
Panama. It repeatedly accused President Balladares of conniving 
to overturn the treaties and impose a new era of U.S. military 
hegemony. This view, by the way, was shared largely by other 
opposition parties, that is to say, Papa Egoro and all the 
others.
    Now, even if--the point I'm trying to make, members of the 
committee, is this--even if the United States and Panama had 
been able to reach final agreement, it is more than probable 
that it would have failed to win approval in a plebiscite. Why? 
Not because most Panamanians wouldn't enjoy having the United 
States stay. General Sumner is right. In my book--I don't know 
how many of you have looked at my book. I reproduced any number 
of public opinion surveys that show overwhelming percentages, 
but when you translate that into active political participation 
in a plebiscite, what happens? What happens is the government 
that convokes the plebiscite loses it. Why does it lose it? 
Because Panama is a deeply divided society. There's no such 
thing as a majority party. Right now we have three groups that 
represent like 15 parties.
    I remind you, for example, that when President Endara 
called a plebiscite to make some minor changes to the 
Constitution, it failed. It failed only because all of the 
opposition parties gained up against the ruling party. Why did 
the plebiscite fail to change the Constitution to allow 
President Balladares to run for a second term? Answer: He 
represents only 30 percent, 33 percent of the vote. The other 
parties lined up against him.
    I can assure you that on an issue as sensitive as a United 
States military presence in Panama, everybody's going to be 
waving the Panama flag, yelling ``more Panamanian than thou,'' 
and I should add one last comment, and that is, that the 
President-elect represents the party that has been most 
consistently anti-United States or at least opposed to a 
residual United States military presence. They're people of 
principle. I happen to think they're wrong, but they're 
principled.
    The PRD is beyond good and evil, and indeed, General Sumner 
was quite right to expect the ``Toro''--President Balladares--
might indeed have done just what you thought because, indeed, 
what--he was looking for a gimmick to allow him to say, ``I'm 
allowing the military to stay but it isn't the U.S. military, 
it's some multi-national military.''
    So, I think we need to be very sensitive to Panamanian 
politics. We have 7 months now in which--well, you say a couple 
minutes, I say 7 months--we have to conclude an agreement, it 
has to be passed by the Panamanian National Assembly, and then 
it has to be put to a plebiscite. Those are very high hurdles 
in Panamanian politics.
    You might say, well, how can that be if 70 percent of the 
population of Panama or 77 percent in some polls favor this. 
These are the histories of Panamanian politics. I invite you to 
read my book, members of the committee, and you will learn a 
good deal more about it.
    Thank you for your time and attention.
    [The prepared statement of Mr. Falcoff follows:]
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    Mr. Barr. The mystery is not unknown to us here in this 
country, about U.S. politics as well.
    Mr. Falcoff. Well, sir, as I say, I am not an expert on 
what went on in the State Department, but I have been following 
Panama for a very long time.
    Mr. Barr. Well, we see the same things here. There 
constantly seems to be a disconnect between polls and what 
people actually care about when you talk to them.
    Mr. Lyons.
    Mr. Lyons. Mr. Chairman, Chairman Gilman, it's a pleasure 
to be here. I did not prepare a written text, believing that I 
would be most valuable in answering some of your questions, but 
let me offer to you that whatever the situation is, I believe 
my value to you as a committee and to the government is the 
ability to look at the future and see what we need to do to fix 
and improve the things that we are already doing to compensate 
for history, if you will.
    I'm sure there'll be continued efforts related to Panama in 
trying to maintain that base, and in lieu of not having a base 
there, having other options. I firmly believe, and as I 
presented to both of you gentlemen, having been to Colombia and 
seen the presentations, that if we are going to be successful 
at stopping drug trafficking out of Colombia and Central and 
South America, the two drugs have two different solutions.
    First of all, on the issue of heroin, which was mentioned 
this morning, the eradication of the opium poppies is the only 
viable solution. I have stated that many times, and quite 
frankly, I believe as a result of visits by yourself when you 
were down there with now Speaker Hastert, the issue of how to 
do that then led to the evolving decisions to go for the 
Blackhawk helicopters, and I commend you for that and the 
progress there, albeit slow.
    The other issue is cocaine. If cocaine does not get over 
the Andes Mountains, in Colombia and/or in Peru it doesn't get 
into the transit zone. I have said for many years, one--I 
believe one of our biggest problems in the United States in the 
way we do business in the government, it's that we have, and 
using a military term, divide and conquer. We have divided our 
efforts, and therefore, conquered ourselves. We have yet to 
fully implement the strategies in place which focus on the 
source zone. If we keep cocaine from crossing the mountains, it 
never gets into containers, it never gets into the high seas, 
it doesn't get onto the ports, it cannot hide under the economy 
and the population of everything north of the Andes Mountains, 
and until we successfully focus on the source zone and 
implement those things necessary, then we are in a state of 
continuing the efforts that we're at now, with some degrees of 
success, but not the success that we all hope to reach.
    One of the things, now that I'm out of government, and 
retired and out working in the private sector, if there was 
anything that I think you could do to help expedite a lot of 
the things that had been put on the table, part of the 
solutions, would be some type of mechanism that would enable 
the U.S. bureaucratic government contracting process to be 
expedited. I hear the term ``fast track'' used in terms of 
expediting trade negotiations. If there was a way to be able to 
write appropriate legislation to create fast track contracting 
capabilities for those things that are earmarked and designed 
for drug support to counter drug operations, we could save an 
immense amount of time and be able to implement many of the 
things that will make a difference across the board.
    With that, I will end my remarks, and I appreciate the 
opportunity to be here.
    Mr. Barr. Thank you, Mr. Lyons, and I'd like to thank all 
of the witnesses for their remarks, and at this time I turn the 
microphone over for questions to the distinguished chairman 
from New York, Mr. Gilman.
    Mr. Gilman. Thank you very much, Mr. Chairman, and I want 
to commend our panelists for being here today. I regret that I 
have to run on to another meeting, but I think you've all 
underscored the necessity of what we should be doing, and I 
particularly welcome General Sumner's proposal. I have your 
letter here that we'll try to pass on to the Secretary of 
Defense, Mr. Cohen, with regard to getting an analysis of the 
dry canal and how it impacts upon the Panama situation.
    And our good DEA representative has underscored the 
problems we're facing with trying to conduct an effective war 
against drugs.
    And Mr. Falcoff, Dr. Falcoff, we appreciate your analysis.
    We can't underscore enough the necessity for the 
administration to take another crack at trying to renegotiate 
the Howard base proposal and the multilateral center that could 
be properly administered in Panama. The cost savings alone are 
enough to make an appropriate review, in addition to the 
effectiveness of having a multilateral base right there in the 
middle of Central America where we can reach out to all areas.
    So, again, I want to thank our panelists, and Mr. Chairman, 
please excuse me. I have to attend another meeting, but I think 
this--both of these panels have been extremely helpful to us as 
we address what has to be done to make our drug war even more 
effective.
    Thank you, Mr. Chairman.
    Mr. Barr. Thank you, Mr. Chairman, and we're certainly 
honored to have you here.
    General Sumner, could you just describe very, very briefly 
the ease with which a terrorist or a group of terrorists could 
disable the canal?
    General Sumner. Yes, I can, I can do that. I don't think 
I'm telling the narcoterrorists anything that they don't 
already know, and it's not just the Colombians. If I were a 
Middle Eastern terrorist, if I were a Serb terrorist, this is 
the Achilles heel--someone said, why, why take terrorism to the 
United States where the lion is, when you can go down to Panama 
and get Bambi.
    The canal is a very fragile engineering project. It depends 
upon millions of gallons of fresh water to move a ship through 
the canal. So the big enchilada here is Gatun Lake. If you blow 
that dam, it will take years to fill it up, and the canal would 
be out of operation for years. If you want to do it temporarily 
you can, as has been suggested, sink a ship in the canal or you 
can get that ship out in maybe 30, 60 days. If you blow one of 
the locks, and these are 70 ton locks about the size of that 
wall up there, you've seen them and they--the United States no 
longer has the capability to fabricate that sort of a lock 
gate, if you will. There are all sorts of things that can be 
done, and all of them are, one, easy, cheap and extremely 
difficult to defend against.
    In my prepared statement, you know, I have in there that we 
had plans to have a division of about 25,000 in there to try to 
protect the canal, and even that, according to most of my 
knowledgeable military friends, said, you know, that's not 
enough. That was assuming that we had the PDF, the Panamanian 
Defense Force, there. Now, we have no Panamanian Defense Force. 
We were talking about here years later we're going to try and 
train a couple of companies, and you mean, the whole thing--it 
just boggles the mind that we would leave this canal 
defenseless.
    Now, having said that, if I were a god, I would put the 
Inter-American Defense Board, which is the military arm of the 
Rio Treaty, I would ask them to take over the mission of 
defense of the canal and put 21 flags over the canal. At one 
time I had a plan to go down there and do that. The 21 
countries would bring in a platoon, a company, and we would 
have an Inter-American Defense Force there, all speaking 
Spanish, and of course, part of that would be you need a very 
robust, vigorous, intelligence capability, because the way you 
stop a terrorist is not when he gets to the canal. You stop the 
terrorist when he leaves home and that's where our intelligence 
comes into it.
    But they--the defense of the canal is a very difficult 
thing, and the impact on our economy, if it is closed, when we 
were down there--I don't know whether I was down there with 
you, Congressman Barr, but we had a ship--a dredge went down at 
the Culebra Cut. Panamanians had no idea how to refloat it. 
There happened to be an American engineer there who went over 
and looked at it and said, well, this is what you do, A, B, C, 
D, E, F, and they got it up and got it out. In the meantime we 
had 150 ships queued out there.
    Now, Ecuador, we talked about Ecuador. Ecuador puts 80 
percent of their exports through that canal, and if you don't 
think that's a biggy or--when you examine it country by country 
it's just--the impact and the importance of this canal is--it's 
almost beyond description.
    Mr. Barr. Thank you.
    General Sumner. Long answer, sorry.
    Mr. Barr. Well, it's very important--is a very important 
one.
    Mr. Lyons, from the standpoint of United States antidrug 
effort, our counternarcotics effort, what is your assessment of 
the complete pullout from Panama of the United States presence 
there?
    Mr. Lyons. It will definitely have an impact, a negative 
impact. The realities are that in the conversations this 
morning about this percentage of reduction of air coverage, 
you're talking about a percentage of reduction of less than 
necessary coverage to begin with. Unfortunately, the Department 
of Defense has several assets that are used that are being 
decommissioned. They've never had, in my opinion, sufficient 
assets to begin with, and when you have the drug issue in the 
position that it is at in the DOD priority list, it will never 
account for enough of the assets that are needed.
    Quite frankly, the real hope I see on the horizon is the 
ROTHR Puerto Rico installation and potentially ROTHR Brazil. 
The other interim solutions could be some aerostats which are 
fairly expensive, but the aerial support would not be drawn off 
because of conflicts such as you have now over in the Balkans 
or anywhere else from Desert Storm, whenever something happens. 
United States Customs used to be operating and based in 
Colombia. They picked up and went home. They are law 
enforcement. They could be there. They could fly. They could 
detect. They could monitor, and unfortunately, they're almost a 
non-player anymore in the source zone. So that is an entity 
that I think could be challenged to return to Colombia to 
provide the services necessary to be able to fill part of this 
gap that DOD just doesn't have assets for, which actually 
United States Customs does.
    Mr. Barr. You mentioned the term ``aerostat''. Could you 
briefly describe what that is and how that might change the 
flight patterns of the smugglers so you could then--you can use 
that to kind of push them in certain directions so you can 
improve your interdiction capability? Can you just describe 
that system briefly and how it might work?
    Mr. Lyons. Well, the aerostat--and I'm certainly not a 
technician so I have some layman familiarity with it--the 
aerostat is a balloon type of device that holds the radar and 
its own internal power system and it is tethered to the ground. 
My understanding is they have made some substantial 
improvements with the aerostat system now to where they have a 
Teflon cable so it does not become an attraction for 
electricity, electrical storms, et cetera. It can be raised and 
lowered depending on what the weather conditions are at the 
time, but what it provides is that invaluable look-down radar 
capability.
    The traffickers--and we had in the embassy a beautiful 
photograph of a DC-3, one of the premier smuggling aircraft in 
Colombia, flying at about 800 feet above the tree tops in the 
jungle. You cannot see or find those airplanes without a look-
down capability. We simply do not have enough military 
detection and monitoring platforms to provide 24-hour coverage, 
7 days a week, for as long as we need it. The ROTHR will help 
but the aerostat gives you a look-down capability, and experts 
in that can tell you what the coverage would be when it's at 
full deployed height. That gives you the ability then to see 
anybody flying low.
    With some new ground based radars that are in Colombia, you 
can see what flies high, but what the smugglers traditionally 
do is fly below the radar signature or around it.
    Mr. Barr. Lieutenant General Sumner, do you have any 
concerns about the Chinese presence, and in particular, would 
you comment on any of the reports that certain of the 
provisions under which Hutchinson-Wampoa was granted the rights 
for port facilities on both ends of the Panama Canal, whether 
that might possibly be in violation of the 1977 treaty?
    General Sumner. Yes, I appreciate that question.
    The legality of the treaties has been brought into question 
again and again, and this brings up another one, this Public 
Law No. 5 that they passed which is in violation of the 
treaties. Incidentally, the treaty is being violated right and 
left. The treaty mandates that you--we have these negotiations 
at the 1977 protocol, and incidentally, when you get looking at 
the treaties, I mean, this is a compendium of all the notes and 
all the protocols that went on, and what we're--what we see 
here is a constant pattern of duplicity, of bribery.
    The Chinese, because as you know we're, Bechtel Corp. or 
any other American corporation is constrained by the Foreign 
Corrupt Practices Act. We cannot go in--well, Mobil tried it 
and Mobil did get Rodman Storage there, but they're being 
accused now of violating the Corrupt Practices Act, and the 
Chinese are--well, they're very slowly changing the Caribbean 
into a Chinese lake. It's a slow process. The Chinese look at 
things in terms of 100 years and that's not being critical. I 
think that they have a long-term vision. They are looking at 
the choke points of the world, Gibraltar, Suez, Panama, Malacca 
Straits, et cetera, and here we're getting into a strategic 
problem.
    And they have now--and you can say--and Ambassador Romero 
said, oh, well, they're just operating the ports. Well, they 
happen to be sitting there. What's the difference between a 
port and a base? Well, what's the definition of is? I mean, you 
know, we're getting into semantics here, and I think 
Congressman Burton, the chairman, brought that point up very, 
very, very definitely, and I feel sorry for Ambassador Romero 
trying to defend an indefensible policy.
    But the Chinese are doing what they see in their best 
national interest, and whether it is moving in to get a grip on 
our canal or whether it's getting all of the weapons 
information out of Los Alamos National Laboratory, another 
thing that I'm very much involved in, the--and, you know, the 
Defense Department sitting here saying that we haven't even 
looked at this, that's such--I mean, that's dissimulation of 
the worst type, I think, for the committee. It's not honest 
with the committee, and Secretary Salazar, I've known her for 
years and she's trapped.
    But the policy of this Clinton administration is the 
problem, and until we get a change in the White House, I don't 
think anything is going to work, and I feel very depressed and 
pessimistic about anything this government does with regards to 
Panama now, unless the Congress nails them down and makes them 
do it.
    Now, if President Clinton wants to refurbish his tarnished 
legacy, this is one thing he could do. He could be the hero of 
the Western World and go down and see the President-elect of 
Panama, Mireya Moscoso, and you know, do it. But why, why isn't 
this important to America? I just fail to see it.
    That is a long answer to your question.
    Mr. Barr. Again, a very important one.
    Focusing just very briefly, and I appreciate you all's 
indulgence, Dr. Falcoff, given your extensive background, both 
in the history of Panama, as well as the political dynamics of 
the country, is there anything that you can suggest that might 
be done at this point, even though it is at the 11th hour, to 
refocus attention with the Panamanian Government, in particular 
perhaps the incoming administration of Ms. Moscoso, to focus 
attention back on developing some sort of joint presence down 
there that would give us the capability to continue operating 
with some degree of assurance our drug interdiction efforts 
that, frankly, I don't think these other scenarios that were 
described this morning can hope to do?
    Mr. Falcoff. May I just make--I have two points I'd like to 
make in response. No. 1, as General Sumner said, even with 
25,000 troops in the area, we couldn't assure the defense of 
the canal. If we were able to have something like the--whether 
it was the MCC, the Multilateral, whatever the abbreviation is 
for the antidrug center, we're only talking about a very small 
number of people and we're not talking about infantry-type 
troops. So their role will be strictly limited to monitoring 
the drug flights and such things.
    Likewise, such a small presence could do nothing to defend 
the southern frontier of Panama with Colombia. That's just--
it's impossible. I'm not even sure 25,000 troops, whether an 
Inter-American force or whether a U.S. force, would be capable 
of doing this. So I think it's important to bear that in mind. 
There are very limited things that can be accomplished with, 
with----
    Mr. Barr. But perhaps important symbolically.
    Mr. Falcoff. Well, symbolically, perhaps. One can choose 
how one wishes to evaluate that.
    The other thing, though, that I want to say is that I'm 
very doubtful that we can accomplish this in 7 months if the 
Panamanian Government doesn't want to go along and cannot sell 
the idea to its own political community. I'm not speaking of 
the Panamanian people. I'm speaking of the organized political 
community in Panama. The National Assembly has to vote on this. 
The largest party in the National Assembly is now the PRD, and 
they are not likely to give this kind of thing to Ms. Moscoso. 
They're going to make life as miserable for her as possible. 
They're going to wrap themselves on the Panamanian flag, 
they're going to call it--sell out to the great legacy of 
General Torrijos, and this will have some impact.
    Now, that doesn't mean, I suppose, that one shouldn't try, 
if that's what one wants to do, and let me add an additional 
point. I believe, the reason the Panamanian Government wanted 3 
years rather than 12 years is quite obvious. They plan to shake 
us down at 3-year intervals.
    I don't know how often you've talked--I suppose you, 
Congressman Barr, because you had a personal history in Panama, 
you've probably talked to more Panamanian politicians than most 
Members of the United States Congress. I had nine members of 
the National Assembly in my office the other day, and I could 
not quite believe what I was told. I was told repeatedly the 
United States had been so terribly selfish in Panama, we'd 
given Panama nothing, I mean, and that people from other Latin 
American countries come to Panama and they're astounded that 
there's poverty in Panama. ``How can there be poverty in Panama 
when you have been so close to the U.S. all these years and you 
had this U.S. presence?'' This was the mantra that was recited 
to me.
    You see, one other dimension of this is the controversy 
over the cleanup of the ranges. You know, it's actually 
impossible to get every last piece of unexploded ordinance out 
of those ranges, and if you ask me, it's a good thing we can't 
because that assures some protection for the environment in the 
area of the watershed around Lake Gatun. But in any event, as 
you probably know, there's a controversy over this. Does the 
Panamanian Government really want to clean those ranges up? Not 
on your life. It's an excuse to shake us down.
    Now, in all defense of the administration, I think a 12-
year demand for at least an opening negotiating gambit was 
reasonable. Three years means every 3 years we'll go through 
what we went through with the Philippines. Finally, the 
Philippines raised the bill too high, and you saw what we did.
    So, I mean, there's a whole politics to this in Panama that 
we will have to get over. We can make our approaches. If we go 
to President Moscoso--if President Clinton goes to President-
elect Moscoso, we might come out with a deal. It will cost a 
lot more than you think it will if we're the ones who are 
asking for it now.
    Mr. Barr. General.
    General Sumner. But it will cost us less than the hundreds 
of millions that it's going to cost us otherwise, and I agree 
with my colleague here, Dr. Falcoff, and his analysis of the 
political situation down there. It's going to be difficult, but 
just because it's difficult, we should try.
    Now, about Howard Air Force Base. I think that--some of the 
World Bank people have come to me, and they would, you know, 
the last thing Panama needs is another international airport to 
come in as underutilized. Now, we're giving them--and I don't 
know how you'd put a figure on Howard Air Force Base, but it 
probably--if it's not in the billions of dollars, it's in the 
hundreds of millions. That facility is a strategic base and 
it's got just--you know, we just put a $20 million hospital in 
there, brand new, which we're going to turn over to them.
    But the World Bank people looked at this in their private 
capacity, and they said what the United States should do down 
there is put in Ellis Island South. We've talked about the drug 
problem, we've talked about the immigrations problems, the 
customs problems that we have in New York, in Miami, et cetera. 
Their suggestion was, let's take Howard Air Force Base and 
establish an Ellis Island South and have all the air traffic 
come in there and have the INS and the Customs people do their 
things there and then let them come on to the United States, 
use that base, and that would give us a United States presence 
there, not military. You know, we don't have to have a military 
presence. It'd be nice, but I think as Dr. Falcoff has 
indicated, it may not be possible.
    But there are, there are other things that I think--and 
incidentally, I understand, and I won't say which Panamanian, 
but a very, very influential Panamanian came to the World Bank 
with this idea, and there are other things, but you have to 
have the will, you have to have the vision and you have to have 
the security interest of this country at heart. I don't see 
that----
    Mr. Barr. Or at least some understanding of it.
    General Sumner. Some understanding. I don't see that with 
the Clinton administration. I think they are--my Panamanian 
friends say why doesn't the Clinton administration want a 
United States military presence in Panama, and I say, hey, the 
Clinton administration doesn't want a United States presence in 
the United States. So, you know, you've got a very fundamental 
attitudinal problem here.
    And you know, the oligarchy, back to political, the 
oligarchy, the Rabi Blancos in Panama, they see this as, you 
know, I showed you the dry canal, they're looking at a closed 
canal, and they look--you know, they're the Phoenicians of the 
Western World, and they see their economic well-being going 
down the drain.
    Now, a politician like Mayin Correa, and I assume she was 
re-elected.
    Mr. Falcoff. The mayor of Panama City.
    General Sumner. The mayor of Panama City, she wants--she 
understands this, and so we have, we have all these, you know, 
it's the politics of politics here, and it's something that I 
hope that this hearing, and we can get something out to the 
American people.
    Mr. Barr. Well, we hope so. Of course, we're hopeful that 
the hearings over in the Senate almost a year ago would and 
they don't seem to have much impact either. I mean, I think we 
can all agree that political situation in each country is 
unique to a large extent or there are certain regional cultural 
aspects that we can identify in certain parts of the world, but 
I understand, Dr. Falcoff, what you're saying, you know, you 
have to look in the entire history of how the United States-
Panama relations played themselves out in the central role of 
the canal and it certainly complicates it.
    I think what's perhaps most mystifying to a lot of us is 
the fact that this whole process sort of went forward without 
there seeming to be any sort of commitment to really try and 
make it work, to use, as the General said, some vision and 
understanding of the dynamics of the situation here, and that's 
what's really a shame.
    If we found ourselves at this point in time, just a few 
months from the complete turnover of all the remaining 
facilities and we could look back and say we tried everything 
possible, we looked at all the options, we talked with 
everybody that we could, we didn't leave any stone unturned and 
still there was no way to do it, that will be one thing. Those 
things happen in international affairs. Sometimes you simply 
cannot reach an agreement.
    But I don't think we're at that point. We're at this point 
now in the 11.9th hour and we look back and there seems to have 
been no commitment to really explore the various options in a 
way that if there was some concept by this administration of 
the importance of the canal, and very honestly, to some extent, 
I think it predates this administration, too, but as with so 
many things, they've sort of taken it to a new level. There 
just doesn't seem to have been that commitment to try and work 
things out, and I think there was frustration on the part of 
the previous Ambassador who I think I was very genuinely trying 
to work something out and get the parties together and so 
forth. That's what is very frustrating.
    If I could just ask one final question, it's a little bit 
off of our track here, Mr. Lyons, but taking advantage of your 
being here and being very familiar with the antidrug efforts, 
not just in Colombia but in the entire Andean region. You're 
very familiar, I know we discussed it down there and have 
discussed it up here, the Peruvian shoot-down policy which had 
been very, very effective for the last couple of years, 
tangibly effective in terms of the cutback in the amount of raw 
coca leaving the country.
    It's my understanding that because of a lack of good 
intelligence and failure of the United States to provide timely 
upgrades to Peru's pursuit aircrafts, which I believe are just 
two A-37's, the shoot-down policy has been essentially halted. 
Is that your understanding, and if so, what are the 
consequences of that?
    Mr. Lyons. Well, the--over the years the intelligence 
provided, I believe about 98 percent of it came from intercept 
operations managed by DEA and in country with Peruvian National 
Police, that provided the early tipoff warning to preposition 
and stage the intercept aircraft, and then the in country 
aerial assets to intercept and track so they could then vector 
in the Peruvian interceptors. That's the other two components 
necessary.
    Finally, the Colombians, primarily, and some Brazilians, 
pilots, that were flying in figured out that this is what is 
getting them caught, their communications over their radios. So 
they have invoked what amounts to as a better OPSEC, 
operational security, and are communicating far less. So that 
early warning is not there.
    There are just simply insufficient look-down radar 
capabilities in the area to be able to cover that huge area, to 
be able to provide early warning based on a track. We don't 
know exactly how they're operating. I believe the flights are 
still coming into Peru. They are most likely landing without 
communicating, and instead of trying to time their event to 
where the cocaine base or, in most cases, bases is ready for 
pickup when the plane arrives, they load it and it leaves 
immediately, the plane will come in and wait until it's ready. 
This way they don't have to communicate. They can come in, get 
a visual signal that it's safe to land, and they can stay on 
the ground until it's ready, and then they can leave and it 
requires no communications.
    That, I believe, is the most likely scenario. We don't know 
for certain, but in any event, the movements, I believe, are 
still continuing without substantial communications. So, the 
inability to have sufficient aerial radar detection platforms, 
and DOD just simply doesn't have enough of them.
    And in the foreseeable future----
    Mr. Barr. When you speak about those platforms, what do you 
have in mind in particular? P-3's?
    Mr. Lyons. Well, there's P-3's with domes. There's the 
AWACs that are able to look down. There's tremendously 
complicated sophisticated systems that get diverted every time 
there's a hiccup some place else in the world and for very good 
reasons. However, that leaves you then with less capability.
    Mr. Barr. Sometimes there are good reasons, sometimes there 
aren't, but your point is well taken.
    Mr. Lyons. In any event, they're always a competing 
resource. Quite frankly, the shift to the ROTHR is a very 
welcome addition to this. I just wish that the Puerto Rican 
ROTHR would come on line sooner. I understand now it's 
projected for January, this coming January, which will help 
tremendously, but it still doesn't overcome the need to have a 
tracker aircraft to be able to go find that initial blip on the 
screen, verify what it is and then be able to vector in the 
intercept aircraft.
    And then--I know that there's work going forward on the 
upgrades to the A-37's and the potted radar that will go on 
that aircraft to be able to assist it in finding, detecting and 
staying with the target aircraft, but again, that whole project 
is held up in the contracting process, and it may be a year to 
a year and a half before you actually see the upgrades on the 
ground in those two countries, Peru and Colombia.
    Mr. Barr. Thank you. Before we break, I'd like to recognize 
in the audience Ambassador David Jordan. We appreciate your 
joining us, Mr. Ambassador. Ambassador Jordan served as United 
States Ambassador of Peru in the mid-1980's and is very, very 
familiar with and has been a very able and eloquent spokesman 
for many of the issues we're dealing with today. We appreciate 
your joining us, Mr. Ambassador.
    Did you have a final comment, General?
    General Sumner. I was going to call attention to the fact 
that David Jordan, the Ambassador David Jordan was here. In 
that connection, you know, we had the Committee of Santa Fe 
which, one, two, three and now we're thinking about Committee 
of Santa Fe four to lay out policy for the Presidential 
candidates next year because I think our total policy to 
include the pseudo-drug war in that unresourced war, I think 
this whole policy has got to be reversed, and I would hope that 
in the new millennium we will see a reversal of this policy 
because we're losing the war, and I don't think you can put--
you can get into the semantics all you want to, but we are 
losing the war. We may lose our economy, and I don't think the 
American people have any idea what's going on.
    Mr. Barr. Well, we certainly appreciate the efforts of all 
three of you. We know that you've been out there fighting in a 
lot different arenas. We very much appreciate it. We appreciate 
you all being here today to share your thoughts with us. We 
will leave the record open for 2 weeks for any additional 
questions to be submitted, and if you all have any additional 
materials, your written statements will be included. Anything 
else you'd like to bring to the committee's attention and make 
them part of the record, please get it to us within the next 2 
weeks.
    We appreciate it very much, and if there are no other 
questions, the hearings are hereby adjourned. Thank you, 
gentlemen.
    [Whereupon, at 1 p.m., the subcommittee was adjourned.]
    [Additional information submitted for the hearing record 
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