President Donald Trump has ignited a bold push to reassert U.S. dominance over the Panama Canal, tasking the military with crafting options to oust China’s influence from this strategic artery. U.S. Southern Command, under Adm. Alvin Holsey, is spearheading the effort, presenting Defense Secretary Pete Hegseth with proposals that span cooperation with Panama to outright military action if talks collapse. The goal: secure a trade route vital to American interests.
Trump’s vision hinges on a historical grievance. “We didn’t give it to China. We gave it to Panama, and we’re taking it back,” he told Congress recently, slamming the Carter-era deal that transferred the canal for a symbolic $1. He claims Panama has breached that pact, allowing China too much sway near a waterway America constructed.
Military planners are weighing multiple paths. Boosting U.S. troop presence in Panama tops the list, with soldiers potentially stationed along the canal as a deterrent. If that fails to curb China’s reach, officials say seizing Panama itself isn’t off the table — though it’s a last-ditch scenario dependent on Panama’s defiance.
China’s shadow drives this urgency. Gen. Laura Richardson warned lawmakers last year that Beijing’s investments, pitched as peaceful, often pave the way for military leverage. She flagged Chinese state firms near the canal as risks to U.S. shipping, especially in wartime, when access could be cut off.
Both Panama and China deny any interference, muddying Trump’s narrative. Still, his administration sees the canal — handed over in 1999 — as a linchpin for national security, fearing Beijing could exploit its proximity to disrupt American naval and trade flows.
Hegseth’s upcoming Panama trip will test diplomatic waters, with Holsey’s strategies in hand. Trump has confided to advisers he wants U.S. forces visible in the canal zone, projecting strength to both Panama and China.
The canal’s handover decades ago marked the end of direct U.S. control, but its role in global commerce keeps it a focal point for Trump’s team as they navigate this high-stakes standoff.
