One of the silent foreign policy failures of the Clinton administration relates to negotiations to maintain US bases in Panama after the canal is transferred at noon on Dec. 31, 1999. A few weeks ago Panama and the United States announced the termination of talks. World shipping interests are alarmed, and the Panamanian economy will also be hard hit.

Under the terms of the Carter-Torrijos Treaty of 1976, the canal is to be transferred to the Government of Panama, and all US military operations in Panama are to terminate as well. Based on the treaty, some 10,000 US military personnel maintained several bases strategically placed and adjacent to the canal. Originally, they were there to protect the canal.

Pools constantly show almost 80 percent of the Panamanian population want the bases to remain. While they certainly enjoy the economic benefits, they also favor the bases because of the stability represented by the US military in Panama. After years of dictators, the US military became one stabilizing factor and a boon to the Panamanian economy.

World shipping supports the presence of US bases because of the perception of stability they provide. With a US military presence in Panama, shippers feel that canal traffic flow is less likely to be impeded.

Finally, the United States wants some of the bases to remain for several reasons. First, drug surveillance is more effective from a Central American geographic position. In addition, the bases have always been useful in carrying out other regional tactical activities. And that is where the Panamanians refused to budge. They wanted any remaining US forces to have only one purpose -- that of surveillance and interdiction of drug traffic.

The negotiations did not have to end. Back in June of 1994, at the time I was chairman of the Panama Canal Commission, I had a meeting in Washington, DC with Gabriel Lewis Galindo, the foreign minister designate of the newly elected Perez Balladeres administration. Gabriel Lewis clearly stated to me that bases could stay, and they could stay under the cover of being there for drug related purposes. There was to be no narrow construction about the purpose for the bases. That information was passed on through appropriate channels of the United States government. Yet, no concerted effort was made to keep the bases even after Presidents Clinton and Perez Balladeres met in early 1995.

Here is another example of where the administration's action never lived up to the rhetoric. With some 14,000 ships transiting the canal each year, destined to or from the United States, preserving a US military presence at that vital choke point of commerce should have been a high priority.