- Historic Sites
Steam Road To El Dorado
Mile for mile, it cost more in dollars—and lives—than any railroad ever built
June 1976 | Volume 27, Issue 4
More than $500,000,000 in gold went across the Panama Railroad in this same ten-year period; more than $140,000,000 in silver, $5,000,000 in jewelry, $19,000,000 in paper money. And the company collected a quarter of one per cent of the value of all precious cargo. The variety of freight handled—besides the usual coal, baggage, and mail—was quite exceptional. One traveler who took time to examine the inside of the freight depot at Colón left this description: Bales of quina bark from the interior were piled many tiers deep, and reached to the iron triangular-braced roof of the edifice. Ceroons of indigo and cochineal from San Salvador and Guatemala; coffee from Costa Rica, and cacao from Ecuador; sarsparilla from Nicaragua, and ivory-nuts from Porto Bello; copper ore from Bolivia; silver bars from Chili; boxes of hard dollars from Mexico, and gold ore from California; hides from the whole range of the North and South Pacific coast; hundreds of bushels of glistening pearl-oyster shells from the fisheries of Panama lay heaped along the floor, flanked by no end of North American beef, pork, flour, bread, and cheese, for the provisioning of the Pacific coast, and English and French goods for the same markets; while in a train of cattle-cars that stood on one of the tracks were huddled about a hundred meek-looking lamas from Peru, on their way to the island of Cuba, among whose mountains they are used for beasts of burden as well as for their wool.
In less than six years after it was finished, having covered all costs (including five years of major improvements from one end of the line to the other— new bridges, improved embankments, etc.), the railroad cleared more than $7,000,000.
Stock dividends for nearly twenty years averaged 15 per cent and went as high as 44 per cent in 1868. Once, with its price per share $295, the Panama Railroad was the highest listed stock on the New York Exchange. There had never been a railroad to stand comparison with it.
The explanation was obvious enough. The road had a total monopoly on the isthmian transit, and until the completion of the Union Pacific in 1869 it had no competition for the California traffic. Furthermore, the rates set for passengers and freight were, on a cost-per-mile basis, extremely high.
The story is that the original rate card was drawn up purely for fun in Colon and sent on to New York for the further entertainment of the head office. But the head office took it seriously. A one-way ticket was twenty-five dollars in gold (about two hundred dollars in today’s money), which came to fifty cents a mile and made it easily the most costly ride on earth. Anyone who objected was of course free to cross in the old manner—up the Chagres, over the Cruces Trail—or, if he preferred, to walk across along the path of the railroad. But the old way generally wound up costing fifty dollars or more (for canoes, mules, guides), and just for the privilege of walking on its right of way the railroad charged ten dollars. Few people ever wished to spend a moment more than necessary en route—because of the terror of disease—and so almost everyone gladly paid the twenty-five dollars, and the rate stood for years.
“And it must be recorded,” wrote Tracy Robinson, “that while there was not the least extravagance in the conduct of affairs, but on the contrary, great simplicity, the officers, clerks, and employees generally were paid generously for their services and the lives of themselves and families made as comfortable as possible under the circumstances.”
Food and housing were provided by the railroad. Headquarters was at the railroad’s hotel at Colon, the Washington House, a long, galleried frame ark facing the Caribbean. “There the officers gathered for their meals, with the chief [Totten] at the head, in true family style,” Robinson recalled. Medical and hospital care were provided free of charge. (Dr. Manuel Amador, chief surgeon for the railroad for many years, a native of Cartagena, would become the first president of Panama in 1904.) There was a library of sorts, a billiard room, and a stone church, built mostly with railroad money, that still stands.
Many Irish, French, and Italian workers stayed on, as did Jamaicans and other black West Indians, and their descendants are to be found at every level of present-day Panamanian society. A blue-eyed Panamanian with an Irish surname is not uncommon.
The beginning of the end came in 1880, with the arrival on the isthmus of Ferdinand de Lesseps. Totten, by then retired, came down from New York to join the tour. Both men were now in their seventies—two whitehaired figures whose respective efforts on two strategic isthmuses had so reduced the size of the world.
As early as 1849 tne great pioneer oceanographer Matthew Fontaine Maury had declared that the true value of a Panama railroad would be the precedent it would establish: “… by showing to the world how immense this business is, men will come from the four quarters to urge with purse and tongue the construction of a ship canal.” And such had been the case, except that de Lesseps was the first to arrive with anything approaching a purse (he was then in the process of organizing his Paris-based Compagnie Universelle du Canal Interocéanique).