Fragmented imperialism

Introduction

Researchers studying control over communications networks in Latin America have debated the extent to which the United States determined the contours of development south of the border. This article examines US control over radio in Panama in the 1914–36 period in order to demonstrate that imperialism with regard to communications networks must be analyzed in the context of interstate rivalry and that US imperialism in the region cannot be understood without a specific kind of rivalry: competition for world leadership.

During the early 20th century, the government and a key multinational corporation from the strongest country in the western hemisphere took an interest in influencing the policies of perhaps the weakest country in the region with regard to radio, a structural configuration that should have produced unquestionable dominance. Explaining the rather different turn of events in Panama requires an interactive analysis between territorial and capitalist logics of power, not static measures of dominance, which ignore the opportunities available for peripheral countries to realize their objectives.

Given the unequal relationship between the US and the countries of the region, few would be surprised to find that the US government retarded the development of commercial radio in Panama, either for mass entertainment or for message handling. Yet, by 1936, the US had willingly reduced its control over both radiotelegraphy, a point-to-point application of radio technology that transmitted messages in Morse code, and broadcasting, a mass medium of great cultural importance. By signing the Panama General Treaty, both nations agreed to allow commercial companies to operate broadcast stations as well as provide radiotelegraph service to ships beyond a 125-mile radius from the port cities of Panama and Colón. Although the treaty permitted the US Navy to keep its hold over radio in what was a vital strategic territory, the absolute and permanent control it had secured in 1914 was gone and the concessions represented a gain to the Republic and to United Fruit, the most important radio company in the Caribbean. Moreover, the gains extended far beyond radio, because disagreements about the technology nearly derailed the entire treaty, which was intended to overhaul all aspects of US-Panama relations.

Literature review

Imperialism, one of the most widely debated academic terms, describes formal or informal foreign control over the assets and decisions of a weaker country. On a political level, the most obvious form of imperialism is direct rule, where a political authority sets itself up as sovereign over a foreign territory and its people (Smith, 1981: 6). In what follows I examine extant theories of imperialism, especially as they have been applied to media and communication studies, to explain the origins of the phenomenon, the relationship between the various imperialist institutions and the impact of imperialism on peripheral countries.

The primacy of economic factors in the development of imperialism has long been a staple of Marxist approaches. Researchers following Lenin have argued that imperialism was driven by entrepreneurs' desire to secure more profitable returns on their investment (Brewer, 1990: 54–5). In the colonial period, capitalists in powerful countries extracted raw materials from their colonies, turned them into finished products and resold them to the colonies. Surplus capital and surplus production both found outlets in dependent countries (Brewer, 1990: 119; Murdock, 2006; Sawhney, 2007). Liberal and realist analyses share the Marxist conceptualization of imperialism as a policy, i.e. ‘a goal-directed activity pursued by identifiable agents', rather than as an unintended outcome of other processes, but these frameworks explain the phenomenon as the aspiration of great powers to improve their positions relative to other great powers in the international system (Arrighi, 2010; Boyd-Barrett, 1998: 165; Headrick, 1991; Kennedy, 1986; Smith, 1981; Wallerstein, 2004; cf. Dewey, 1927; Thompson, 2000).

The political economy of communication situates media and communication industries in the general framework of imperialism and relies on various Marxist theories of the process to address the problem (Boyd-Barrett, 1998: 158; Fejes, 1986: ix; Schiller, 1991: 14). Developed in the postwar decolonialization period, this research program links the origins of imperialism to unequal relations of production, but seeks to examine more subtle forms of economic and cultural control than territorial acquisition. In this framework, the media industries support the objectives of the decisive financial-industrial sectors that control the means of production, while large sections of the public have no access to either the means of production or the means of communication (Boyd-Barrett, 1998: 164; Fejes, 1986: ix; Mattelart, 1979; Schiller, 1991: 14).

With access as their central concern, scholars have expanded the scope of analysis from the international system in the post-Second World War period to intra-national and local inequalities in all time periods with the objective of accounting for the colonization of communications space (Boyd-Barrett, 1998: 163; cf. Harvey, 2003: 32). This ‘generic model’ of media imperialism is characterized by empirical breadth as well as a commitment to quantitative indicators of dominance. Recent research has rethought the privileged position accorded to the content industries, given their role in exercising symbolic control over populaces, and addressed contemporary ICT and communications networks (Boyd-Barrett, 1998: 164; 2006; Lee, 2008; Mattelart, 1979: 14). A similar reorientation has yet to affect the historical study of infrastructure industries, which is why the study of US–Latin American relations in radio is richer in analyses of shortwave propaganda than in radiotelegraphy (Fejes, 1986; Schwoch, 1990).

When analyzing the relationship between the institutions of imperialism, classical Marxists see the state and corporations working together to achieve their compatible, if not identical, objectives (Boyd-Barrett, 1998: 158; Fejes, 1986: 9; Mattelart, 1979: 3; Schiller, 1991: 20). In historical analyses of an expansionist US foreign policy, this emphasis on cooperation, coupled with the influence of a shared ideological framework in the government, produces the specter of a formidable imperialist power with unified objectives (Rosenberg, 1982: 13). By contrast, neo-Marxists highlight the relative autonomy of political, economic and cultural processes, while subordinating state interests to capitalist interests in the long term (Horwitz, 1989: 42; Rupert, 1995). David Harvey’s widely cited study, which has influenced this recent conceptualization of imperialism in media studies, for example, set out to analyze the contemporary ‘contradictory fusion’ of the politics of the territory-bound state and of global capital diffused in space and time (Harvey, 2003: 26–7; Murdock, 2006; Winseck and Pike, 2007).

By drawing on Giovanni Arrighi’s work in understanding capitalism and territorialism as opposite logics of power, Harvey links the study of imperialism to historical-structural approaches to the world system. The Marxist and the realist strands of this research program share the following traits: an interest in the interdependence of long-term political and economic processes, an understanding of imperialism as territorial expansion and a conviction that imperialism is linked to geopolitical rivalry, whose objective is the attainment of world leadership. However, while Marxist world-systems analysts focus on the process of capital accumulation and core–periphery division of labor, realist long cycles researchers examine the relationship between long-term economic growth and global war (Arrighi, 2010; Thompson, 2000: 6; Wallerstein, 2004).

Once abroad, imperialist powers maintain control over dependent populations by coopting local elites, with the threat of force in the background (Hobsbawm, 2008; Sawhney, 2007: 44). However, such material explanations often seem insufficient to explain the extent of control exercised, which is why researchers have turned to the symbolic realm. Arrighi draws on the Gramscian concept of hegemony and defines world leadership as the power associated with dominance expanded by the exercise of intellectual and moral leadership. A state may become world hegemonic because it can credibly claim that the expansion of its power is in the interests of all states (Arrighi, 2010: 29).

Structural imbalances and powerful ideas notwithstanding, macrostructures do not determine the course of development in the periphery (Hayes, 2000: 26; Smith, 1981: 6, 14). While media imperialism researchers stress the pressures exercised by the capitalist world system and downplay the importance of political independence, a comparison with the historical alternative − colony status − reveals that almost all states have the ability to take some initiatives (Boyd-Barrett, 1998: 158; Smith, 1981: 54). These initiatives, however, do not necessarily promote the interests of the local population. Local elites may challenge center country objectives, further them or simply use the rhetoric of dependency to secure political gains for themselves (Fox and Waisbord, 2002: 2; Hayes, 2000: 41).

This article seeks to advance our understanding of imperialist powers' motivations and peripheral countries' freedom of action. Given their empirical depth, interactive analyses are necessarily imbalanced and my focus here is primarily on government policy rather than capitalist expansion (see Winseck and Pike [2007] for a more thorough treatment of the latter). To uncover the differing stances of the participants, I rely on the collections of the Navy Department including the files of the Director of Naval Communications, the records of the Latin American Division in the State Department well as the records of the Panama Canal, all located in the National Archives. Personal papers of key decision-makers, including Stanford C Hooper, Francis White and Sumner Welles, have also been consulted.

‘A new weapon since the original treaty’: Radio in the context of US–Panama relations

In the wake of Britain’s decline, America’s influence in the western hemisphere expanded in concentric circles from the Caribbean to Central America, reaching Latin America by the First World War. As the US emerged as an industrial giant, commerce became key to its prosperity and policy-makers developed an offensive naval strategy to compete for world trade and assert the country’s new status. Naval power was seen as vital to ascendancy in the world system and the US acquired several colonies in the hemisphere to serve as bases which could resupply a modern coal and oil fired fleet (Baer, 1993: 9, 13). Given the strategic importance of Panama for the US, Panama’s dependence on its powerful neighbor and the key role of radiotelegraphy in coordinating fleet movements, it is not surprising that this early application of radio technology became an auxiliary of territorial imperialism or that Panama granted the US absolute and permanent control over the technology.

The linchpin of US economic and strategic influence in the hemisphere was control over an inter-oceanic canal across the isthmus of Panama, the shortest route from the Atlantic to the Pacific Ocean (Major, 2003: 10). The Panama Canal − under construction between 1904 and 1914 and fully available to ships in 1920 – promised eastern merchants access to markets in the Pacific and facilitated the transfer of warships between the two oceans (Major, 2003: 161).

At the height of British hegemony, the British government repeatedly blocked America’s attempts to secure these benefits by denying the US unilateral control over the proposed canal (Major, 1993: 22). By 1901, as technological innovation had shifted to the US and Germany, the economic foundation of British military might had crumbled and the Royal Navy had lost the power to oppose the US Navy in the Caribbean. Britain withdrew from the region and gave the US free reign in the canal development (Beloff, 1970: 87; Thompson, 2000: 16). The State Department immediately negotiated treaties that provided for unilateral American control of the proposed canal with negligible input from the countries – Colombia and, after its US-backed secession, Panama − on whose territory the isthmus lay (Major, 1993: 34–42).

The new republic was predestined for dependence. Its population did not reach half a million, 70 percent of whom were illiterate (Major, 2003: 128). The country was roughly the size of South Carolina and its economy was mostly agricultural. Most of its export revenue derived from the banana trade, which, in turn, was controlled by the US-based United Fruit (Major, 2003: 144). In the negotiations over the next 30 years, this country with no navy and no army would face the third-ranked naval power in the world whose army provided the only military presence in the isthmus (Major, 2003: 137, 157).

In addition to the country’s size and level of development, the 1903 Hay-Bunau Varilla convention was chiefly responsible for Panama’s inferior status vis-a-vis the US. Although the Panama Canal was no less important for the US than the Suez Canal was for Britain, the former did not impose direct rule on all of Panama. Instead, it secured by treaty perpetual ownership of the canal and 10 miles of territory on each side of it, which became the Panama Canal Zone: the US was sovereign in the Zone, while Panama became a protectorate (Major, 2003: 44, 47). Washington guaranteed Panama’s independence against a foreign aggressor and paid a US$10 million indemnity for the right to use the canal (Major, 2003: 57). The Republic did retain its sovereignty, but the canal treaty authorized American intervention into its internal affairs (Major, 2003: 116). The country’s sovereignty would be further diminished in time of war as its highways, railroads, air defense and communications would all serve America’s security objectives (Major, 2003: 5).

Whether in peacetime or wartime, naval policy-makers saw control over Panama’s airwaves as a corollary to territorial imperialism and sought to bring them under US control. The isthmus was a fortified zone serving as the first line of defense in a war against the US, they argued, which meant that the US needed even greater control of radio there than on its own sovereign territory (Hooper, 1931c; Standley, n.d. c. 1934). Policy-makers planned a chain of stations covering the entire isthmus, established the first such station in 1905, and advocated exclusive control over radio to achieve the immediate mobilization of communication resources required in wartime (Bryant, 1923: 2; Kilbourne, 1934). In 1911, the Navy secured a monopoly over radio communications in the Canal Zone and began to push for an absolute and permanent monopoly in the Republic (Major, 1993: 165).

The Navy’s tightening control threatened to disadvantage the United Fruit Company, the key external participant in the economic affairs of the region. Created in 1899, the fruit company centralized the production and distribution of bananas in the Caribbean and Central America and marketed them in North America. Its control over land, labor and capital appeared to drive the economies of peripheral countries and invited a charge of economic imperialism. In order to ensure smooth processing of its numerous concessions, United Fruit was said to have cultivated a famously good relationship with friendly governments and rigged elections to produce said governments (Bucheli, 2005: 3; Langley and Schoonover, 1995: 21).

Just as the Navy was extending its radio network in the region, United Fruit erected radio stations to coordinate its new fleet of ships in order to solve the central problem of the banana trade: getting the fruit to customers before it rotted (Bucheli, 2005: 9, 45; Schwoch, 1990: 21). The company’s 1905 station in Bocas del Toro was one of the first commercial stations in the region. In 1910, and again in 1913, executives secured new concessions to establish stations, reassuring the Panamanian government that the matter would be ‘adjusted in Washington’ with the Navy Department (Daniels, 1913: 1).

The Panamanian government’s interest in radio – most importantly as a means of control over outlying ‘centers of unrest’ – was hardly satisfied by the existing US installations (Bullard, 1915: 2). During the early 1910s, Panamanian policy-makers repeatedly assured their American counterparts that no permit for a station would be granted without consulting them, then proceeded to grant permits and plead ignorance. The American consul chalked up this behavior to incompetence, rather than skilful maneuvering, informing the State Department that frequent changes in Panamanian officials made any kind of permanent understanding between the two governments difficult (Dodge, 1912).

While the State Department was inclined to approve the permits, naval policy-makers had no interest in adjusting matters with the company. Citing heightened international tensions, the Navy Department postponed the execution of the United Fruit Company’s 1913 contract with the Panamanian government, but agreed to the continued operation of the company’s Bocas property on the condition that no additional stations were erected (Davis, 1922; Division of Latin American Affairs, 1911). Thus, the company that controlled the means of production did not control the means of communication. Far from aiding United Fruit’s expansion in the radio field, the US government actively blocked it.

In contrast to the informal agreement between the US and United Fruit, the application of American Marconi to erect a station provided the catalyst for a formal agreement extending the Navy’s monopoly to the Republic. In 1912, the subsidiary of British Marconi proposed to connect the US with Panama and South America and integrate the country into its worldwide wireless chain (Griggs, 1912). While United Fruit used radio for internal communications, the Marconi Company was in the business of message handling for its customers, and its executives had long been convinced that international communication alone would make wireless pay (Barber, 1904). Their focus on international, rather than ship-to-shore or ship-to-ship communication, meant that geographical expansion was key to profitability. Expansion to Panama, however, meant an intrusion into US strategic space, while the proposal to connect the US to the world went against the growing desire for confidential communication that did not go through British facilities (Headrick, 1991).

Even if the company’s motives were purely capitalistic and devoid of any British strategic calculation, naval policy-makers could not see it that way. Britain’s decline did not register with policy-makers responsible for radio, who saw the increasing presence of the Marconi companies as the extension of British control over world communications into the new field of radiotelegraphy (Schwoch, 1990: 35). ‘It is of the opinion [sic] of this Department that the effort of the Marconi Company should be frustrated’, the Acting Secretary of War wrote to the State Department, asking for a prohibition of private wireless installations on the territory of the Republic (Breckinridge, 1913).

Although naval policy-makers acknowledged privately that the canal treaty did not cover radio, as it was ‘a new weapon since the original treaty’, and the State Department doubted the necessity of such a drastic measure, the US government presented a united front to Panama in demanding ‘absolute and permanent’ control over radio in the Republic (Gill, 1931: 1; McClure, 1931; Moore, 1913). Panamanian policy-makers, by contrast, did not press for either the full control of communications due a sovereign country or joint control of radio, perhaps because they still felt the sting of America’s rejection of their 1907 request in connection with submarine cables (Major, 2003: 164). Instead, negotiators sought to whittle down American demands to temporary and incomplete control (Price, 1914). When they failed, the Panamanian government ended up with a deal that damaged its sovereignty, but served its long-term interests.

During the negotiations leading to the 1914 decree, Panamanian diplomats worked hard to secure concessions, retreating inch by inch. They first sought to reserve Panama the right to erect its own radio stations (Taylor, 1922c). The US government demurred. Panama then requested six radio stations in specific locations that would help tighten the control of Panama City over the rest of the country. The Navy Department agreed to the request, but cut the number of stations to three and placed them at locations that had the most military value for the US (Alfaro, 1922; Bullard, 1915; Notes, 1931). Yet, the location of these stations was clearly a compromise as American policy-makers complained well into the 1930s how useless two of the three stations were, because they carried a very small number of messages, mostly from the Panamanian government (Irwin, 1931a).

When the talks ended, the decree of 1914 gave Washington absolute and permanent control over every type of wireless communication in the Republic (Price, 1914). With this measure, the US extended territorial control over the Republic’s airwaves and secured the equivalent of direct rule. It was smooth sailing because the American government acted in a concerted fashion and neutralized the opposition of commercial companies. By 1921, then, all of Panama’s radio and cable communications were in US hands. Seven of the eight radiotelegraph stations on the isthmus were operated by the US Navy, one by United Fruit, while cable services were provided by the Central and South American Telegraph Company (The radio system, 1921). The emergence of broadcasting along with the United Fruit Company’s persistence would soon turn this neat equation topsy-turvy and reopen the question of naval control.

‘A just cause of complaint’: Radio control and the road to the 1926 draft treaty

In June 1922, decision-makers in the Canal Zone considered requests from the Panama Radio Club and other broadcast enthusiasts to authorize amateur broadcast transmission and reception in the Republic (Taylor, 1922a). While the broadcast boom was in full swing in the US with around 60,000 sets in private hands and hundreds of stations in operation, on the isthmus there were only six radio receiving sets that year, most of them operated by former US Navy radio men (Sterling and Kittross, 2002: 862; Taylor, 1922a). Broadcast stations were not authorized; all the people of Panama were able to catch were occasional broadcasts from the US (Taylor, 1922a). Local policy-makers' intransigence in connection with broadcasting and their lack of unanimous support for the request by United Fruit to offer commercial radiotelegraph services prompted Panama to address radio control during the treaty negotiations then underway between the two countries. At stake was the continuation of the Navy’s absolute monopoly over radio.

The immediate decision about radio matters fell to the Commandant of the 15th Naval District and the governor of the Panama Canal, the men responsible for various aspects of canal defense, who regarded the local population as incompetent and corrupt. The interest in broadcasting seemed to them either a promotional ploy by radio set manufacturers or a ‘foolish clamor’ by a people who lacked both the capital and the varied talent to sustain a broadcast service (Morrow, 1923a: 1; Taylor, 1922d; 1922e: 1). ‘There is much resentment at our exercise of control’, the Commandant acknowledged, but ‘if we do not do it, no one will, as these people can control nothing’ (Taylor, 1923: 1). The primary problem with ‘these people’, Admiral Taylor explained, was that instead of efficiency of communication, they based their decisions on ‘satisfaction of personal or political friendship’ (1922e: 3). While Governor Morrow would have authorized a limited commercial broadcast service, if only to show Panama that the only way they could participate in broadcasting was by tuning in to programs from abroad, Taylor prevailed and the request was rejected (Morrow, 1923a; Taylor, 1923). That local policy-makers did not have the final answer became apparent when a stern letter from the State Department suggested that they ‘relieve the people of Panama from unnecessary and annoying restrictions' (Phillips, 1923: 1).

In response, local authorities tied broadcast permits to such exacting conditions on set ownership that negotiations soon foundered (Irwin, 1923). Under Morrow’s plan radio sets in the Canal Zone and the Republic were to be licensed and the licensee was to display the permit in the vicinity of the set. The US reserved the right to supervise these sets and recall them in wartime (Morrow, 1923b). These conditions, which were more restrictive than those obtaining in the US at the time, were summarily rejected. Panama wanted to issue the licenses itself and inspect the receivers in the Republic (Counter memorandum, 1923). In a symbolic act of defiance, the Panamanian government also ordered two sets for the presidential palace, refusing to request permission from the US (South, 1923).

Meanwhile, United Fruit renewed its request to round out its Central American network of radio stations, putting it on a collision path with the Navy (Davis, 1922). The company was no longer content using radio stations for internal communication; it also wanted these stations to pay their way. At the heart of the profitability of radiotelegraph stations lay ship-to-shore traffic: messages to and from ships transiting the canal (Woolsey, 1933: 15). However, the Navy considered work with these messages part of preparing naval operators for their wartime missions (Memorandum, 1934). Admiral Irwin, the incoming Commandant, disapproved of competition in what the Navy saw as the core use of radio and warned his superiors that the United Fruit Company had ‘as its ultimate motive, complete control and dominance’ of radio facilities in the isthmus (1924: 2). If the government made the slightest concession, Irwin predicted, it would lose control of all radio traffic in the area (1924).

The Panamanian government was interested in both applications of radio technology: broadcasting speeches would disseminate the government’s message to the largely illiterate population, while a commercial radiotelegraph company would presumably be more responsive to a customer’s needs than the US Navy. Panamanian diplomats bypassed local US officials and threatened Washington with abrogating the 1914 decree, which they painted as a temporary measure signed under pressure in an emergency situation. The Navy’s monopoly had to be reconsidered in light of the emergence of ‘radio-phone communications', i.e. broadcasting, and the resulting affront to Panama’s sovereignty whereby Panamanian immigrants to the US had a better chance to enjoy this service than Panamanian citizens in their own country (Alfaro, 1922).

Just how radio should be controlled was to be decided by treaty negotiations, which were launched in 1920 to overhaul the commercial relations between the two countries (Major, 2003: 107). The talks appeared to be beneficial for all involved. Panama’s threat to abrogate the decree exposed the fragility of US control over radio in the isthmus and naval policy-makers sought a firmer foundation (Taylor, 1923). The State Department believed that offering a quid pro quo on another subject for Panama’s concessions on radio matters would facilitate resolution of the problem (Draft letter, n.d. c. 1924). Panama also stood to benefit: a more in-depth look at radio revealed the fault lines in the Navy Department and brought the State Department into the mix, whose narrow understanding of American security needs was favorable for the Republic.

Panama’s request for the reconsideration of radio control led to a spirited discussion in the Office of the Director of Naval Communications in Washington that paved the way for the relaxation of the Navy’s absolute control in 1924. Policy-makers focused less on the shortcomings of Panamanian political culture or the ulterior motives of the United Fruit Company than on the difficulties of absolute control and the opportunities presented by commercial radiotelegraphy. Interference no longer necessitated absolute control and naval operations under regulated interference could even help prepare for the deliberate interference of an enemy (Memorandum, n.d.; Taylor, 1922b; Tawresey, n.d.). Moreover, a ban on receivers was difficult to enforce and a ban on radio stations prevented the Navy from supplementing its outdated equipment with a company’s modern equipment in wartime (Memorandum, n.d.; Tawresey, n.d.: 3).

Broadcasting raised the unique problem of denying Panama an opportunity for self-expression and highlighted the ways in which the various uses of radio technology were intertwined with the liberal distinction between raw power and legitimate authority. ‘No matter how insignificant Panama may be in a military sense’, Lieutenant Commander Tawresey explained, ‘any continued and arbitrary injustice or wrong practiced against Panama… weakens our position morally and, therefore, also in a military way. We can only reach maximum security in the Canal Zone when might coincides with right’ (Tawresey, n.d.: 1). Radiotelegraphy was an auxiliary of territorial imperialism and its naval control had been justified, but broadcasting was an entirely different matter. Symbolic control was not a priority, given the extent of real US power in the isthmus. In the absence of exploiting broadcasting for propaganda, however, there was very little to gain from monopolizing an application of radio technology that was relatively unimportant from a naval point of view. Insofar as American policy-makers recognized the importance of broadcasting, therefore, this recognition actually helped relax America’s grasp. Moreover, if perceptions influenced the extent of a country’s power, being viewed as unfair toward a minor country would materially diminish American security on the entire continent. Panama had just cause of complaint, Tawresey contended; if the United States could not provide satisfactory radio service, it should allow the Republic to do it under American supervision (Tawresey, n.d.: 1, 6).

Based on these principles, the Navy Department decided that the people of Panama should not be denied radio broadcasting and came up with a unique solution: the Naval Communications Service would undertake the task (DNC, 1923). Because no financial support was forthcoming from the US, the Commandant solicited voluntary listener material and talent for programs (Denby, 1923; Ziegemeier, 1923). This arrangement remained in place until 1936 and stunted the development of Panamanian broadcasting.

On the matter of general policy, however, there was substantial progress. In 1924, the Joint Board of the Army and the Navy recommended allowing commercial companies to operate in the Republic, provided their application was subject to a US veto. In wartime, absolute control would return to the US (Joint Board, 1924). The recommendation formed the basis of Article IX of the proposed treaty between the two countries, which was signed in July 1926 (Major, 1993: 110). Under an informal agreement, ship-to-shore telegraphy was reserved for the Navy (Burgess, 1931). The US did retain a range of veto powers, which could serve as proof that the basic inequality of US–Panama relations did not change (Major, 1993: 183). Yet, official recognition of the distinction between peacetime and wartime brought Panamanian radio regulations in harmony with the Radio Act of 1912, which governed American radio, and signaled to all that the Republic’s radio industry was no longer on permanent war footing.

Instead of rejecting the Panamanian request for radio sets and broadcast stations or authorizing both in hopes of using radio for US propaganda, the US government abandoned its absolute control over radio. Panama facilitated the process by taking the issue to the national level and pushing for the inclusion of radio in the treaty negotiations, but did not dictate the ways in which policy-makers thought about the problem. The radio provision of the treaty emerged from a difference of opinion between local and national policy-makers and a broad conception of the national interest on the part of the latter. Tangible concessions for such intangibles as US prestige in Latin America were on the table so long as core US interests were safeguarded. This distinction between essential and non-essential American interests was also characteristic of the State Department’s view and would soon pit the diplomats against a hard liner Navy in the 1930s.

‘The history of this Company has been one of continued opposition to the naval, military and Canal Zone authorities': United Fruit and the conflict over commercial radiotelegraphy

The concessions with regard to radio in the 1926 draft treaty were insufficient to offset what Panamanian lawmakers deemed to be inadequate concessions on other items, so they refused to ratify the agreement (Major, 1993: 114). The Republic reaped praise for its firm stand from other Latin American countries, and soon followed up with a direct challenge to US control over radio (White, 1927). In December 1930 Panama abrogated the 1914 decree without informing the US (Major, 1993: 287). Since the National Assembly of Panama never ratified the decree, the argument went, it never legally came into force (McClure, 1931). During the next six years the State Department negotiated with Panama about radio control while attempting to harmonize its view of the national interest with the Navy Department’s.

After the Republic’s decision, the State Department blamed the Navy, the Navy pointed the finger at United Fruit, while the canal directorate identified the conflict over licensing radio receivers as the root of the problem (Crosley, 1934b; McIlvaine, 1930; Treaty Division, 1931). Indeed, the situation in broadcasting had improved little since the 1920s. The Panamanian government was not allowed to and the Naval Communications Service refused to provide a permanent schedule, so the 300 sets that existed in the Republic picked up programs from neighboring countries (McClure, 1931). Broadcasts were confined to the occasional benefit for victims of shipwrecks and relied on borrowed equipment, while requests for public talks were rejected. The Navy did not intend to open its facilities to all comers, nor was the Commandant interested in assuming the functions of the Federal Radio Commission, so the opportunity to speak was denied to all (Irwin, 1931b).

The State Department immediately initiated negotiations with the objective of restoring legitimate American control (Stimson, 1931). Aware of the political and cultural importance of mass communication, the diplomats recognized Panama’s right to receive some benefit from radio, which was no longer the ‘secondary medium of communication’ that it had been in 1914 (McClure, 1931). On a more practical note, in order to secure Panama’s consent to a treaty, essential American needs had to be separated from mere conveniences. What mattered for canal defense was wartime control; the decree of 1914 went beyond America’s needs and the radio provision of the unratified treaty was sufficient (Dawson, 1931: 8).

The diplomats' interest in legitimacy echoed naval policy-makers' discussions during the previous decade and revealed the Hoover and the Roosevelt administrations' desire to reconcile imperialism with American prestige (Major, 1993: 253). The linchpin of this approach was respect for the rule of law. ‘We could take over [Panama] and nobody would dare to oppose us by force’, wrote the head of the American delegation in the 1920s, ‘but we would have no legal right to do so’ (White, 1925). The US ignored Panama’s sovereignty at its peril: charges of high-handed imperialism and unfavorable parallels with the old days of the British Empire would result (McClure, 1931). The only way imperialism and a positive reputation could be reconciled was if the US negotiated treaties that conferred the Republic all the power it sought. Political independence thus mattered a great deal; a sovereign state with the power to consent to a treaty could count on concessions well beyond the ones its overall weight in international relations afforded.

The Office of the Director of Naval Communications, by contrast, now rejected the concessions embodied in the radio clause of the 1926 treaty and sought to retain every ounce of control the US had secured in 1914. The new treaty had to codify the Navy’s monopoly on mobile – i.e. ship-to-shore and plane-to-ground – traffic, although even the Director of Naval Communications failed to recall why the Navy had always reserved this right (Hooper, 1931a, 1931b). In June 1931 the General Board supported the director’s decision, arguing that ‘relinquishment of this government control [was] not justified in the interests of relatively unimportant commercial advantage’ (General Board, 1931: 2).

The two opposing views of the national interest clashed for the last time shortly after United Fruit applied for another license in February 1933 and Harmodio Arias, the President of Panama, took up the matter of radio control during a state visit to the US (Crosley, 1934a). During his October visit, Arias made clear to the US government that Panama wanted the authority to license commercial stations, and if a Radio Board were established to handle license applications, Panama wanted to appoint it. The Panamanian delegation also pushed for wartime control and suggested that the Navy should perhaps obtain necessary training in US territory (Memorandum, 1934).

Naval policy-makers' fury at such impertinence was not primarily directed at Panama, but United Fruit. Longstanding fears were confirmed when the company’s Panama City station, erected with the Navy’s permission in 1930, began to successfully compete with the naval station for ship-to-shore traffic and blasted its signal at such a high power that the latter was completely jammed out (Crosley, 1934c). United Fruit wanted all the commercial traffic in the region, fumed Admiral Crosley, the new Commandant, and company executives coached the President of Panama to abrogate the decree (Crosley, 1934b, 1934c). Whether naval policy-makers' suspicions were justified is for future research to discover, but the United Fruit Company’s influence in Panama cannot be denied. Given the US government’s unwillingness to finance the Panamanian government’s spending, United Fruit stepped in. Panama became heavily indebted, offering its revenue from banana exports as collateral for loans (Major, 2003: 129, 133).

Naval policy-makers agreed that a company should not be allowed to embarrass the US government in its relations with a foreign state. Were the Navy to accept Panama’s demands, Admiral Crosley pointed out, it would mean that ‘the United Fruit Company [had] defeated three Departments of the United States Government in a ten-year campaign’ and evaded the restrictions necessary for the defense of the Panama Canal (1934c: 3). The highest ranking officer in the Navy, Chief of Naval Operations Admiral Standley, saw the clash between territorial and capitalist logics of imperialism as an example of a larger trend where private companies in many fields of the economy advanced their interests at the expense of military preparedness (n.d. c. 1934).

Where the State Department ran elaborate calculations to arrive at a model treaty that would secure essential American interests, while enhancing the country’s prestige in Latin America, the military calculus was far simpler. Panama was merely ‘a technically sovereign state’: only its power in the international system mattered (Kilbourne, 1934: 1). The State Department had to impress on the Republic that ‘without the Canal the Panamanian nation would not have come into being, nor could it continue to exist’ (Kilbourne, 1934: 1). The US was paying for the right to use the canal and was responsible for Panama’s defense: its interests were paramount (Crosley, 1934c; Hooper, 1934). If Panamanian politicians were too obtuse to see this, the US should withhold the canal annuity (Major, 2003: 288).

Since the State Department refused to convey these sentiments, the matter required input from the White House. President Franklin D Roosevelt sided with the diplomats on the general policy toward Panama, but it would take another two years to work out the details of the agreement. The problem of broadcasting was relatively quickly resolved with the transfer of two of the three stations that the Navy had erected for Panama and whose value for the US was seen as negligible (Welles, 1934).

However, radiotelegraphy threatened to hold up the entire treaty. Panama wanted the world to see that it, not the US, controlled ship-to-shore traffic in its territory and both sides made clear that the problem was a dealbreaker (Welles, 1935a). Policy-makers rejected a possible solution that would have split ship-to-shore traffic into canal traffic and commercial traffic, handing the latter over to United Fruit, in favor of one that limited complete naval control to a certain radius of the Panama Canal. Finally, after nearly 100 conferences, the Panamanian government agreed to the latest American proposal, which restricted naval monopoly to a 125-mile radius from the canal, much less than the 500 miles demanded by the Navy (Crosley, 1934c; Welles, 1935b).

In March 1936, a new treaty was signed, which replaced the restrictive 1903 convention and ended Panama’s status as a protectorate (Major, 1993: 4). Among the material gains in the radio field, Panamanian policy-makers are likely to have secured a concession on another matter under negotiation and received two radio stations for free. The recognition that – with the exception of a certain area – they had the final say about all radio matters in their territory was a symbolic victory that affirmed the Republic’s sovereignty. The US was also satisfied that its interests were safeguarded. President Roosevelt was informed that the restricted area was merely a ‘face-saving device’ in order to avoid putting Panama in a position inferior to every other sovereign country in the world (Welles, 1936). Indeed, the territory under US control covered the entire country from north to south and excluded only about 100 miles on the eastern and western borders. This was the center of commercial life and military activities where most commercial telegraph traffic took place. While the Navy was dissatisfied with the relatively narrow conception of American security that prevailed within the US government, the United States also shared in the symbolic gain: with a successful treaty behind it, the aspiring world leader was surely different from its predecessor.

Conclusion

By recording quantitative indicators of ownership of radio stations on the isthmus, a researcher would find 100 percent American dominance throughout our time period, but miss the tensions between US policy-makers on the ground and their counterparts in Washington, between the various government departments in Washington and between United Fruit and naval policy-makers, all of which contributed to the voluntary relaxation of American control between 1914 and 1936. The researcher would similarly overlook the importance of the transition from radiotelegraphy to broadcasting and the possibility of collaboration between an American multinational and a peripheral state in dismantling core state restraints. Finally, she or he would be unable to assess whether Panamanian policy-makers did well or poorly within the constraints they faced. Key implications of this research are thus methodological: interactive analyses of capitalist and territorial logics of power deserve a more prominent role in the political economy of media and communication technologies and interactive analyses of imperialism are usefully connected to changes in a country’s position in the world system.

While interrelated in the long term, the territorial and capitalist logics of power are clearly separable during American ascendancy (Harvey, 2003; cf. Arrighi, 2010: 60): radiotelegraphy, for example, played a different role in the business models of United Fruit and the Marconi Company, but both companies' plans of expansion in Panama ran up against naval opposition. Even though there were no geopolitical concerns about United Fruit’s operations, the Navy did not permit the company’s control over the production and distribution of bananas to extend to the means of communication. Radiotelegraphy was understood as a weapon and the US government sought to use it to advance American interests quite distinct from those of commercial companies.

While Panamanian diplomats exploited the fault lines in the American government and adroitly wielded the protection afforded by sovereignty, their skilful maneuvering alone does not explain the change in US policy. American policy-makers could have defined US security needs broadly and squeezed every bit of independence out of Panama, but they clearly held back. By placing the interactive analysis in the context of the transition from British to American leadership in the world system, this article has linked communications policy to changing attitudes on the part of American negotiators. Fragmentation, not unity, characterizes the internal dynamics of imperialism in an ascending world leader and, given the task of establishing the moral and intellectual leadership on which world leadership rests, prestige and the example of the previous hegemon figure prominently in policy-makers' calculations.

Policy-makers in the 1910s still thought of their country as one of the great powers and their primary preoccupation with regard to radio in Panama was blocking British expansion in their backyard. By the 1930s, however, the State Department became interested enough in America’s reputation abroad to make tangible concessions. The diplomats' concerns with the rule of law may simply reveal the constraints posed by dominant liberal ideas on US foreign policy, but it is striking how inconsistently such ideas affected naval policy-makers. Perhaps the change in America’s economic and military status made the diplomats more optimistic about the country’s chances for world leadership and more sensitive to the demands of the job. Instead of policy-makers' taken-for-granted assumptions, then, this case reveals a deliberate attempt to assert the moral and intellectual leadership that sets hegemony apart from dominance and a studied effort to distance American leadership from the discredited example of its British predecessor. Without additional research focusing on the transformation of liberal internationalism in the context of American ascendancy these two options remain equally plausible.