Row upon row of pressed-metal postal boxes, most unused because of the gradual U.S. exodus, gazed blankly at Panamanian women selling lottery tickets from card tables. Stalls in the plaza were hung with rugs, Panama hats, and other tourist regalia, but across the avenue the Teatro Balboa had a distinctly mid century North American demeanor, if a slightly derelict one.      The Balboa Union Church nearby, built of concrete like many of the U.S. structures, glowed a bright pastel orange in the hot afternoon sunlight, a colorful contrast with the aqua-marine windows in the nave. Maltese crosses built into the facade brought to mind both the aesthetic and the military components of this southern billet, where a church was built to last and Protestantism was expected to prevail.      A different sort of spiritual need was once met up the hill in the Masonic Scottish Rite Temple, closed when I visited, the watchman asleep in a chair in the lobby. On the door were painted renditions of cobras, scarabs, and Egyptian ankhs. Towering rectangular columns, green tiles, and window grills suggested a tropical knock off of Frank Lloyd Wright. I imagined Yankee men in ritualistic palaver while their kids played in the nearby YMCA and their wives exchanged pleasantries in the commissary.      AFTER ENACTMENT of the Panama Canal treaty in 1977, the ports, the railroad (which had provided limited commerce between the oceans before the canal was built), parts of Balboa and other settlements-Diablo, Pedro Miguel, Gamboa, all west north of Balboa and Panama City-began to revert to Panama. No one knows how many millions of dollars the United States had invested over the years in the zone, but in Balboa every conceivable need of transplanted North Americans had been met. The cocoon was so snug that some U.S. citizens never left it, even to visit Panama City or the country upcanal.      It was the only total social experiment that ever worked," said Roberto Sarmiento, who ran the Panama Canal Commission library, which included not only the commission's considerable book collection but also canal artifacts: aged black-and-white photographs, a scale model of the old French hospital on Ancon Hill, commemorative medals, and a plaque dedicated to Gorgas. "Everything was provided by the United States government, from housing to Christmas trees."      Sarmiento had made an effort to preserve the commissions collections in the face of official Panamanian indifference. He was due to leave the country for a new job in the States within two months of our talking together. "This is a fantastic country," he said, "but just what will happen to the old zone is anybody's guess."

The North Americans I spoke with were mostly fatalistic about the takeover. "It's very sad," said Dolores De Mena, historian at the U.S. Army base, whose documents had already been boxed up, ready for shipment to the United States. "They're letting stuff go," she said, referring both to structures and land. "They're going for the bucks," said another departing U.S. citizen working for the commission, referring to the high rents North Americans in Panama have to pay to occupy reverted structures originally built by the United States.      My guide on the tour of the Miraflores locks, a Panamanian fluent in English whose grandfather had immigrated to Panama from England, was one of the thousands of Panamanians now on the commission payroll performing tasks once assigned to North Americans. He predicted a stiff increase in fees charged boats for use of the canal, but beyond that he declined to speculate. Although accredited as a guide by the commission, he knew little about the history of the zone or the structures in it.      The agency in charge of all reverted property is the Interoceanic Regional Authority, created after the treaty signing and destined to go out of existence after the final transfer of property to Panama. A spokesperson in the authority's development office, Michel Eleta, told me that most of the buildings that look abandoned in Quarry Heights and elsewhere were in fact on the market. Those in the Heights were of great interest to embassies, she added. Negotiations were under way to turn the Gorgas Hospital into a regional medical center for patients from all over Central America.      The grammar and high schools in Balboa possessed "outstanding potential" as tourist facilities, Eleta said, but no formal arrangements had been made, and Balboa High School remains fenced off. The Administration Building, that omnipresent reminder of triumphant 1914, could become central to the life of post-U.S. Panama: It was being considered for the new residence of the president of the country.      PANAMA CITY MAY BE THE ONLY CAPITAL on earth where true wilderness presses against the city limits. This is thanks to the U.S. military which ran the zone like a sovereign country for so long, preserving structures and habitat along with security. Today the environmental outlook for the interoceanic region is also murky. Metropolitan Park, on the edge of the city, a few years ago easily accessible and offering sightings of keel-billed toucans and other ornithological and botanical wonders, has been transformed by a toll road that plows through it. Some Panamanians got rich from it, which struck others as a harbinger.      Dozens of environmental organizations exist in the country, from those actually dedicated to preserving the environment to those that are mere fronts for developers. Purity of purpose can be difficult for the ecominded in Panama, a country so hellbent on exploiting what has so long been inviolable. The precedent set by the building of the canal itself was, from a strictly environmental perspective, disastrous, as William Lyman Phillips suggested when he described it as "the greatest liberty man has ever taken against nature.