The Strange Affair Of The Taking Of The Panama Canal Zone


Silva’s task was made harder by the fact that, figuratively and literally, his principals were hard to reach. Bogota was an inland capital, several thousand feet above sea level. It had telegraphic communication with Colon and Panama City, and from there by underwater cable to the United States. But wire service was often interrupted, and all steamer mail had to be unloaded and brought by mule over tortuous, weather-vulnerable trails, a trip of several days to several weeks.

Hence the politicians in Bogota heard little from the outside world and suffered from a kind of parochialism that made them refer to their city—which had poorly paved streets and almost no telephones but had an auditorium for plays and operas—as the Athens of South America. In “Athens,” in the spring of 1901, the feeling was that there was plenty of time to negotiate with the United States. To begin with, the United States had a half-century-old agreement with Great Britain, known as the Clayton-Bulwer Treaty. Under it the two nations had cooled a long rivalry in Central America by agreeing that neither would seize exclusive control of, or fortify, any trans-isthmian canal or land route; that both would support the neutrality of any such route; and that neither would “occupy, fortify, colonize or exercise dominion over” any part of Central America. That agreement would hold things up for some time. Moreover, in 1904 the New Panama Canal Company’s rights would expire and remove that distraction from the picture. The Americans might make better terms then.

Dr. Silva had labored in vain to correct these impressions. He had written dispatches pointing out that Secretary Hay was making excellent progress with the British ambassador on a new agreement that would abrogate Clayton-Bulwer and allow for an American-defended canal. (The result, the Hay-Pauncefote Treaty, was, in fact, signed in December of 1901 and soon ratified.) He had also read American journals of opinion carefully and knew the “tiger” was not very patient. The only result of all this caution was to provoke messages from Bogota telling him to go slowly, make no price concessions, and yield as little sovereignty as possible. And finally, Bogota was sending him on another mission, though only temporarily, quite possibly to silence his negativism.

Scene III. Washington, January 20, 1902

William Nelson Cromwell had a lawyer’s familiarity with (and distaste for) sudden and unexpected strokes of fortune that totally reversed the direction a case was taking. Yet even he could scarcely believe what he had read in the newspapers for the preceding two days. President Roosevelt was forwarding to Congress the final recommendation of the Walker Commission. It was that “the most practicable and feasible route” for an isthmian canal was “that known as the Panama route.” And yet just one month earlier, to the very day, the battle had seemed hopelessly lost to Nicaragua, and Cromwell himself had been fired by the New Panama Canal Company.

The first bombshell had burst on November 16, but the fuse had been lit in the middle of the preceding month. In answer to repeated proddings from the Walker Commission, the New Panama Canal Company finally put a price tag on its properties. The sum read $109,141,500 for everything, from maps and blueprints and the forty-seven-mile-long Panama Railroad that crossed the isthmus to prospects of future profits. Admiral Walker was a New Hampshire Yankee with at least seven generations of merchants and traders behind him, and he had no difficulty in recognizing an inflated figure when he saw one. Whatever the French stockholders might think, their holdings were only, in the estimates of his experts, worth forty million dollars. His official answer to the French was in the commission’s final report of mid-November. The cost of digging the Nicaragua canal was estimated at about $190,000,000. That of a Panama canal would be, to the last penny of the estimate, $144,233,358. But to go through Panama the United States would have to add the purchase price of the New Panama Company’s holdings, and anything much over forty million would not only be a bad bargain but would push the Panama Canal’s price beyond that of a Nicaraguan cut. Therefore it was eminently clear: the “practical and feasible route” would be through Nicaragua.

Two days later the Hay-Pauncefote Treaty was signed. With the verdict in from the commission and the green light flashing from London, Nicaragua seemed inevitable, and Panama doomed.

Swiftly, somehow, the directors of the New Panama Canal Company came to terms with the reality that they had one and only one potential customer. They wired Secretary Hay that forty million was an acceptable price to them. The news came too late to head off House passage of a new Hepburn bill for a Nicaragua canal on January 9—but not too late for Theodore Roosevelt to call the Walker Commission back into session on January 16.

Cromwell’s last-minute reprieve from disaster owed much to Leon Czolgosz, who, on September 6, 1901, had fired a mortal gunshot wound into the belly of President McKinley. McKinley’s death brought Theodore Roosevelt to the Presidency and changed the terms of the Panama equation. The country had never had such a President. He was only forty-three. He was well-read, knowledgeable about world affairs, a splendid if dominating conversationalist, and a supple writer of history, biography, nature lore, essays, and letters.