A CENTURY AGO, when colonial empires held sway, it seemed to many Americans right and natural for powerful countries to rearrange the affairs of lesser states. This is how President Theodore Roosevelt broke Colombia's grip on the territory of Panama so that the United States could construct an interoceanic canal. That the canal was a marvelous work serving American strategy and global commerce alike gave the Panama phenomenon an aura that warms many Americans to this day.

Now the United States is doing what new times require: releasing the canal to the full sovereignty and responsibility of the unconsulted people on whose alienated territory the waterway was built. Twenty years ago, responding to Panamanian nationalist currents, the U.S. Senate agreed to Jimmy Carter's treaties on a phased handover. Many Panamanians now wonder whether they are up to carrying such a demanding burden. But most know there is no turning back. The local boast is that Panamanians will run the canal as reliably and efficiently as Americans have. They do most of the work already.

Bigger ships and creation of a two-ocean Navy have made the canal, though still useful, less central to American interests. In addition, the treaty itself gives the United States an ultimate right of canal defense. These considerations undercut the residual canal anxieties held by some Americans. They profess to see the handover as a retreat and a surrender; some have used a Hong Kong firm's contract to run two cargo terminals in the canal zone to manufacture a scare of an imminent Communist Chinese threat.

The continuing importance of the canal to American shipping makes alertness necessary. But the best security for the canal will inevitably come from the strengthening of Panama's democracy and economy. A pity that this week Bill Clinton, by not taking direct part in the handover ceremony, missed a chance to symbolically fortify the emerging American canal partnership with Panama.