U.S. Decides to Indict Noriega, Risk Retaliation

The Reagan Administration has decided to go ahead with drug indictments against Panamanian military leader Manuel A. Noriega despite concerns that he might retaliate against U.S. interests, officials said Thursday.

Administration officials considered the possibility that Gen. Noriega, whose indictment is expected to be announced in Florida today, might seek reprisals but have concluded it is unlikely he would make a major move against the Panama Canal or other sensitive U.S. facilities in that nation, they said.

Federal law enforcement authorities said Noriega was indicted Thursday by federal grand juries in Miami and Tampa, Fla., on charges of racketeering, cocaine trafficking and money laundering. The long-expected indictments were sealed by a federal magistrate, but U.S. attorneys in the two cities scheduled announcements for today.

Castro Dealings

Officials said one of the indictments focuses in part on Noriega’s dealings with Cuban leader Fidel Castro, who reportedly mediated a 1984 business dispute between the Panamanian strongman and members of a Colombian drug cartel.

Noriega was quoted by CBS News as dismissing the indictments as “strictly political.”

Noriega, commander of Panama’s Defense Forces, the nation’s sole military and police organization, has turned himself into a virtual dictator in his strategic country, which includes the 48-mile-long canal linking the Atlantic and Pacific oceans.

In secret studies prepared before the decision, the State Department and CIA laid out a range of potential Panamanian reactions to the indictments. These projected possibilities ranged from an anti-Noriega coup by military dissidents to political reprisals by Noriega against U.S. military and diplomatic facilities in that nation.

Treaty Provisions

But in the end, a knowledgeable intelligence source said, the most likely immediate reaction was judged to be: “Nothing.”

The U.S. extradition treaty with Panama does not require that nation to arrest or extradite Noriega, and the general could simply ignore the indictments and attempt to hang on to power, officials said.

The announcement of indictments against Noriega is expected to intensify public sentiment against the military strongman, they said, but the main question--as before--is whether other Panamanian military leaders will decide “to dump the guy,” in the words of one State Department official.

For months, the Administration has been urging Noriega to quit, to no avail. Secretary of State George P. Shultz publicly called on the general to “step back” from power, and a senior Defense Department official told Noriega privately not long ago that the Pentagon also wants a new government.

Pressure Denounced

But Noriega, who has been accused of ordering the assassination of political opponents, of massive corruption and of providing intelligence data simultaneously to the CIA and Communist Cuba, has stubbornly refused to relinquish power. He has denounced U.S. pressure against him as a “rightist plot” to prepare the way for an American seizure of the canal, which was turned over to Panama in treaties negotiated by President Jimmy Carter and ratified in 1978.

Under the treaty, Panama received unchallenged sovereignty over the canal and the parallel stretch of territory on either side of it that used to be known as the Panama Canal Zone, but the United States retained rights to manage and defend the waterway until Dec. 31, 1999.

The United States has about 10,000 troops in Panama, primarily for the defense of the canal. Panama is also the headquarters of the U.S. Southern Command, which coordinates all U.S. military activity in Latin America.

Officials said several agencies, including the CIA and U.S. diplomatic and other missions in Panama, were ordered to prepare “a worst-case scenario” of what was likely to occur in the wake of the indictments. The possible outcomes included:

-- A move by anti-Noriega officers to depose the strongman.

-- A move by the civilian government of President Eric A. Delvalle to place Noriega under some form of “near-house arrest.”

-- Relatively mild anti-American moves by Noriega, possibly including the expulsion of U.S. citizens or a demand for the acceleration of Panama’s management and defense role under the canal treaties--a demand the Administration would reject.

-- More threatening actions, possibly including a move to align Panama with Cuba and Sandinista-ruled Nicaragua.

But the agencies concluded that no overt move against U.S. forces at the canal is likely.

Ex-Aides’ Evidence

Much of the evidence against Noriega has come from three former aides and associates of the general, former Panamanian consul Jorge I. Blandon and two convicted drug smugglers, Floyd Carlton and Steven Michael Kalish.

In a series of interviews with U.S. and Panamanian newspapers, Blandon has charged that Noriega dealt simultaneously with Castro, Colombia’s Medellin cocaine cartel, the CIA and then-White House aide Oliver L. North. He told the Washington Post that Noriega agreed with North to train from 200 to 250 Nicaraguan Contras in Panama during 1985 and 1986.

Carlton, a pilot, has said he flew more than $1 million in bribes to Noriega from the Colombian drug cartel.

Kalish told a Senate committee last month that he delivered a $300,000 bribe to Noriega in 1983.