History

Prior to the Spanish Conquest, three main indigenous groups inhabited the isthmus that is now Panama: the Cuna, the Guaymi, and the Choco. These groups owned and farmed land communally in villages, and engaged in specialized crafts such as pottery, stonecutting, and metallurgy.

In 1501, Rodrigo de Bastidas sailed westward from Venezuela in search of gold, and became the first Spaniard to reach the isthmus. He explored the coastal area and returned to the West Indies. One year later, Christopher Columbus, too, explored the isthmus? eastern coast, and established a short-lived settlement called Antigua del Darien. In 1513, Vasco Nunez de Balboa led an expedition on a 25-day trek through the jungle to the western coast, proving that the isthmus was a path between the Atlantic and Pacific Oceans. The Spaniards called the path El Camino Real (The Royal Road).

Upon the settlement of Spaniards in the Panamanian isthmus, the indigenous people faced a series of massacres and diseases. Those who survived fled into the forests or to the San Blas Islands, and the conquistadors soon brought in Africans to replace the Native American slaves. The African slave trade flourished for over 200 years in Panama.

In 1538, the king of Spain brought Panama under royal control by appointing governors and their staffs and establishing courts called "audiencias." Panama remained a Spanish colony for nearly 300 years, until 1821.

From the beginning, the colony?s identity and economic success were based on the geopolitical importance of the isthmus, which varied with the volume of trade that the Spanish Empire was able to support. In the sixteenth century, Panama thrived as the crossroads and marketplace of the Spanish Empire in the New World. Gold and silver were shipped from Mexico and Peru, hauled across the isthmus, and loaded onto ships headed across the Atlantic to Spain. In the seventeenth and eighteenth centuries, the decreasing strength of the Spanish empire and the growing presence and dominance of English buccaneers in Panama forced the colony into a period of neglect and serious economic decline.

Social hierarchy in Panama was rigid, with the Spanish-born "penisulares" occupying the highest government positions, and the "criollos" (those of Spanish ancestry born in the colonies) holding the second-tier positions in government and trade. The "mestizos," of mixed Spanish and Native American blood, worked in agriculture, retail trade, and services, and African and Native American slaves made up the underclass. The Roman Catholic Church enjoyed an extremely close relationship with the government and gathered a great deal of wealth through tithes and land ownership.

Although it maintained its own "audiencia," Panama was eventually made part of the Viceroyalty of Colombia. A strong sense of nationalism developed among the inhabitants of Panama, who, despite the political union to Colombia, were highly isolated from the other Spanish colonies. Internal conflicts between the sectors of Panama?s highly stratified society countered that nationalism to some extent.

On Nov. 28, 1821, a meeting was held in Panama City, and, without violence, Panama declared its independence from Spain. After much discussion, it was voted that Panama would become a department of already-independent Colombia, with two provinces, Panama and Veraguas.

The California gold rush greatly increased the traffic passing through Panama. A group of New York financiers organized the Panama Railroad Company, and in 1855 a track was constructed that connected the Atlantic and Pacific coasts. Panama experienced growth and economic prosperity during that time, until traffic died down with the completion of the transcontinental railroad in the United States in 1869.

From 1879 to 1889, a French company attempted to construct a trans-isthmian canal under the direction of Ferdinand de Lesseps, builder of the Suez Canal. The project failed due to disease, faulty design, and bankruptcy.

Panama declared its independence from Colombia in 1903, and entered into the Hay/Bunau-Varilla Treaty with the United States. The treaty designated a zone ten miles wide and fifty miles long to which the United States would have rights "as if it were sovereign." The U.S. would build a canal in that zone, and then administer, fortify and defend it "in perpetuity." An enormous engineering triumph, the fifty-mile lock canal was completed in 1914. It has been Panama?s economic base ever since. With the signing of the Hay/Bunau-Varilla Treaty in 1903, Panama became a virtual protectorate of the United States. Indeed, relations with the U.S. have been a primary cause of concern for Panama in both international relations and domestic politics since then.

From 1903 to 1968, Panama was a constitutional democracy dominated by a commercially oriented oligarchy. In the 1950s, the Panamanian military began to challenge the oligarchy?s political hegemony. Twice the military overthrew President Arnulfo Arias Madrid, and upon his re-election in October 1968, the military overthrew him for a third time and he was sent into exile.

A military junta government was established, and Brigadier General Omar Torrijos Herrera assumed the role of head of the government and principle power in Panamanian political life. With an emphasis on public works, Torrijos enjoyed the popular support of urban workers and small farmers, but his regime was oppressive and corrupt. The "Partido Revolucionario Democratico" (Democratic Revolutionary Party or PRD) served as a political arm of the military dictatorship throughout Torrijos? time in office. In 1977, the Torrijos administration signed two treaties with the United States that were put into effect in 1979. The treaties transferred control of the Canal Zone to Panama, so that the U.S. and Panama would administer the canal jointly through the Panama Canal Commission until the end of 1999, at which time U.S. forces would withdraw from Panama.

Torrijos formally stepped down as head of government in October 1978, but he and the Panamanian army continued to control the political scene under a nominally civilian government. Torrijos died suddenly in a plane crash in 1981, and in the power vacuum that he left, a series of civilian presidents controlled by the National Guard followed. General Manuel Antonio Noriega was placed in command of the National Guard in 1983, which he quickly transformed into the far larger Panama Defense Forces (PDF). Noriega assumed the presidency, and quickly gained firm control over the PDF and the civilian government. As during the Torrijos regime, the PRD functioned as a political tool of the military dictatorship.

In the summer of 1987, a grave crisis developed out of the long-time rivalry between the military and civilian elites when a loose coalition of over one hundred civic and religious groups and businesses organized widespread anti-government demonstrations. Meanwhile, tension was building between the U.S. and the Panamanian governments, and the U.S. embassy was attacked. In response to these events, the United States stopped economic and military assistance to Panama. The Panamanian government retaliated in December of that year by ousting the U.S. Agency for International Development, and a complete cut-off of U.S. economic assistance to Panama followed.

Conflict between the United States and the Noriega regime continued. In February 1988, General Noriega was indicted in U.S. courts on drug trafficking charges. In April of the same year, President Reagan invoked the international Emergency Economic Powers Act, thereby freezing Panamanian government assets in U.S. banks and placing sanctions on a variety of payments to the Noriega administration by American firms, agencies, and individuals.

National elections were held in May 1989 in Panama, with anti-Noriega candidates receiving over three times more votes than he. The Noriega regime quickly annulled the election and implemented a new round of repression, as the enormous opposition victory and the presence of international observers had prevented the regime from successfully controlling the outcome of the vote.

Noriega?s hold on power was extremely weak by the Fall of 1989. A failed and bloody coup attempt took place in October. Abandoned by all but a few cronies and distrustful of the shaken and demoralized PDF, Noriega began to employ irregular paramilitary groups called Dignity Battalions. By December 1989, daily life for U.S. forces and citizens was unsafe due to the regime?s paranoia.

On Dec. 20, 1989, President Bush ordered the U.S. military into Panama. Its objectives were to protect U.S. lives and property, to operate and defend the Canal as dictated by U.S. treaty responsibilities, to assist Panamanian citizens in restoring democracy, and to bring Noriega to justice. The mission was completed successfully in one week?s time. Noriega eventually turned himself in voluntarily to U.S. authorities, and he is now carrying out a 40-year sentence in Florida for drug trafficking.

Panamanians worked swiftly to reconstruct their civilian constitutional government. On Dec. 27, 1989, the National Electoral Tribunal reversed the Noriega regime?s annulment of the May 1989 election, and the victory of opposition candidates was confirmed. Guillermo Endara, Guillermo Ford, and Ricardo Arias Calderon were sworn in as president and vice presidents, respectively.