A ditch not dug

In 1911, U.S.-Latin American relations almost took a dramatic turn for the different.

In October of that year, the head of the Panama Canal Zone's civil administration, Maurice Thatcher, told a U.S. Senate committee, “We must have courts ...  I would like to see an American civil population here ... These Americans would come here to live, make their homes here, and they would prefer to live under the dominion of the American government, under American laws.” 

George Goethals, the rather un-Brooklyn-like Brooklynite in charge of construction thought differently.  “Introduce the franchise, and we’d go to pieces.”  The Taft administration agreed with Goethals.  The Canal Zone was not to receive elected government, civil courts, or even private property.  The Zonians remained a population of transients.  (Vocal, obnoxious, and slightly-crazy transients, but transients.)

But what if Thatcher had won the argument?  The Zonians would have owned farms and businesses.  They would set their own tax rates.  They would elect their governor.  The strange monopoly that the federal government held over ancilliary businesses would not last.  The Zonians would not all work for the federal government.  They would be a settled population, certainly larger than the actual Canal Zone population, which bounced around 50,000 in the 1950s and '60s.  And it is hard to imagine them lacking a non-voting representative in Congress.

Under such circumstances, could Congress have agreed to give the Canal Zone back to Panama?   

Comments

[Peter]

Congress barely approved the Canal Zone's return as things were. I can recall all the political fighting over the issue. It's a reasonable guess that having a larger population in the Canal Zone, with private property rights, would have tipped the balance and lead to defeat of the treaty with Panama. In fact, it might never have gotten proposed in the first place.

[Will Baird]

I think it'd reduce the likelihood, but it all depends on its status in general. After all, didn't we set up extensive courts, etc? Or do you think that there'd be a lot more pasty Americans down there that would make it more palatable for our more racist past to want to keep?

[Noel Maurer]

Executive Order 7676 of July 27, 1937 set up two court districts in the C.Z.

The Zone remained dominated by the Canal operation, which employed over 80 percent of U.S. civilians. In essence, it was a large company town.

Under the Thatcher plan, there would have been an elected Zonian government, and Americans there would have been free to start businesses, own property, and engage in commerce. I don't know whether the population would have been larger; but it would no longer have been transient, and it would have a bigger stake in the Zone than their government paycheck.

In other words, handing back the Zone would not have simply been handing back the Canal, it would have been handing over a permanent (if small) population of Americans and their property to a foreign country. In addition, the Zonians would have had an elected government to represent their interests.

Under those circumstances, could Congress have relinquished control of the Canal Zone?

[Peter]

Paul Theroux's book The Old Patagonian Express had an account of his travels in the Canal Zone. It was written in the mid-1970's I believe, not long before the treaty. His portrait of the "Zonians" was not particularly favorable.

[Randy McDonald]

Am I corrected in understanding that the United States controlled the territory while Panama was still recognized as the sovereign power, right?

We might end up with another Guantanamo.

[Noel Maurer]

The legality was weird. The Hay-Bunau Varilla treaty said nothing about sovereignty, and the courts gave different rulings at different times.

That said, to answer your question, it wouldn't have been another Guantanamo.

Why, you ask? Because the Canal Zone was in fact just like Guantanamo: a wholly-controlled de facto military enclave, at least until 1937.

Under the Thatcher plan, though, the Canal Zone would have had a civil government, with a grant of civil rights, and been part of an American court district. In other words, just like Guam.

To use some phrases that I otherwise avoid these days: In OTL, the C.Z. = Guantanamo until FDR extended civil court jurisdiction to it in 1937. In ATL, the C.Z. = Guam from 1912 onwards, with not just courts but full civil and economic rights for all residents. (Unless they were African-American, but that was sadly common to a lot of the United States at the time.)

Am I making sense? From your question, I'm worried that I was terribly unclear.