Backing Away from a Latin Dictator

By TED GUP

Even by the old standards of Latin American despots, Panama's strongman General Manuel Antonio Noriega is no slouch. He has been accused of drug running, money laundering, election fraud and helping to steer restricted American technology to the Cubans and Soviets, not to mention repressing his own people. Yet Noriega, the Commander of the Panama Defense Forces and de facto dictator since 1983, has been adept at exploiting his country's strategic position. Although he openly cuddles up to Havana, he has long enjoyed a cozy relationship with the CIA, and his country plays host to the headquarters of the 10,000 troops of the U.S. Southern Command.

Thus it seemed that Noriega could always count on U.S. support, suffering at worst an occasional diplomatic snub or reprimand. But with the allegations against him mounting and his support at home diminishing, the Reagan Administration is now debating whether such support is wise. It may undermine U.S. attempts to be seen as tough on drug trafficking, vigilant against high- technology theft and credible in its call for democracy in Central America.

Noriega is currently being investigated by the Justice Department and three federal agencies. In Tampa, Customs and FBI agents are probing allegations that Noriega was paid off to facilitate the smuggling of drugs into the U.S. In Miami, the Drug Enforcement Administration (DEA) is looking into similar accusations. In addition, Ramon Milian Rodriguez, a Cuban-American convicted in 1985 of drug-related charges, has testified in closed hearings to a congressional committee that Noriega pocketed millions of dollars in commissions on drug profits that passed through Panama's central bank.

Noriega's cronies have also been suspected of drug trafficking. His personal aide, Colonel Julian Melo, was implicated in the operations of a large cocaine laboratory inside Panama; Melo was fired but not prosecuted. Last year Cesar Rodriguez, who had worked as a pilot for Noriega, was murdered in Colombia in what appeared to be a drug deal gone awry. Critics charge that while Noriega has deported some midlevel traffickers to the U.S., he has never arrested the cocaine barons who use Panama as a plush hideout. After Colombia's Justice Minister, Rodrigo Lara Bonilla, was assassinated in 1984, leaders of the Colombian drug cartel headed for Panama to escape the heat.

U.S. officials are worried about more than Noriega's alleged drug dealing. Customs agents say they have identified more than 75 Cuban and Soviet-bloc front companies apparently using Panama to circumvent restrictions on the export of American high technology. Every month, they say, tens of millions of dollars worth of restricted U.S. technology goes to Panama, far beyond that nation's modest needs. Customs Commissioner William von Raab says he believes Noriega "is a beneficiary of the activities of these ((front)) companies." Major Florentino Aspillaga, a senior Cuban intelligence officer who defected to the West this summer, has charged that Noriega received about $3 million for allowing Cuba and the Soviet Union to acquire U.S. technology.

The debate over what to do about Noriega has at times pitted U.S. officials against one another. Last October the State Department asked Von Raab to meet with some visiting Panamanian officials and present them with gift-wrapped parcels. The Customs commissioner, who has long believed Panama to be a haven for drug dealers, was unaware that the packages contained plaques expressing Washington's appreciation for Panamanian assistance in cracking down on narcotics traffic. Fumed Von Raab: "I was snookered." Von Raab is skeptical about talk of Panamanian cooperation with U.S. law enforcement. "Just because they throw a few crumbs to us or any other agency," he says, "it doesn't change the character of the country as a flea market for contraband."

Attorney General Edwin Meese and Assistant Attorney General Stephen Trott have been among Noriega's staunchest supporters. They cite his willingness this year to have Panama's bank-secrecy laws amended to allow U.S. investigators limited access to drug-money accounts. In an effort to scuttle a resolution critical of Panama's drug enforcement policies last March, Trott told a Senate committee, "The Panamanians have given ((the DEA)) 100% of its requests in terms of drug traffickers." An unlikely coalition led by North Carolina Republican Jesse Helms and Massachusetts Democrat John Kerry was nevertheless able to push the resolution through. In the House, New York Democrat James Scheuer has blasted the Justice Department's praise for Panama's antidrug efforts as "disingenuous and intellectually dishonest," charging, "Noriega is involved in drug trafficking and money laundering right up to his kazoo."

What may finally tip the balance against Noriega within the Administration is political factors. Recent protests in Panama show growing middle-class opposition to his rule. After pro-Noriega demonstrators damaged the U.S. embassy in Panama in June, Washington suspended military and economic aid; the freeze will continue, suggested Secretary of State George Shultz, until Panama's military gets out of politics. "There's been a decision made that we can afford to let the relationship deteriorate a little bit," says a State Department policymaker. The Pentagon and some in the intelligence community, concerned about Cuban activity in Panama, are coming to a similar conclusion. Explains one official: "Now the consensus is rising that we're better off without him than with him."

With reporting by Elaine Shannon/Washington