, 2 THE PANAMA CANAL TOLLS 



veyed to the American Government, while the Act was still under discussion, by way 

 of a warning that a formal protest would follow, 1 was that this was a violation of Article 

 III of the Hay-Pauncefote Treaty of 1901, which said that " the canal shall be free 

 and open to all vessels. ... so that there shall be no discrimination against any nation 

 in respect of the conditions and charges of traffic." It was also intimated on behalf 

 of Great Britain that if the Act was passed, in spite of the protest, she would appeal for 

 arbitration as to its legality to the Hague Tribunal under the Treaty of 1911. The 

 result of this protest was a special message to Congress by President Taft on August 

 1 9th, before the bill was finally passed, in which he argued that. the exemption of 

 American "coastwise vessels" from tolls was not a violation of the treaty. (It may 

 be noted that on December 21, 1911, he had sent an earlier message, dealing with the 

 importance of leaving it to the President, within certain limits, to fix the tolls, and 

 had said, without referring to the Hay-Pauncefote Treaty, that he was "confident that 

 the United States has the power to relieve from the payment of tolls any part of our 

 shipping that Congress deems wise.") As, however, " distinguished lawyers of the 

 House and Senate" and also Great Britain differed from this construction, he recom- 

 mended Congress to pass a resolution, or add a clause to the bill, distinctly say- 

 ing that nothing in it should be " deemed to repeal any provision of the Hay-Paunce- 

 fote Treaty or to affect the judicial construction thereof," and giving a right of action 

 against the United States in the District Courts, with appeal to the Supreme Court, 

 to any foreigner who considered the provisions of the Treaty to be violated to his 

 detriment. This suggestion, however, was not acted on, and, so far as Great Britain 

 was concerned, was regarded as obviously unsatisfactory. A domestic court of law 

 was not the place for arguing the violation of a treaty right. According to Presi- 

 dent Taft's contention, and the purport of the new Panama Canal Act, the Hay- 

 Pauncefote Treaty was not being violated at all, and the proper place for having that 

 question decided, according to the Arbitration Treaty of 1911, was the Hague Tribunal.' 



In the Press of both countries during August and September President Taft's atti- 

 tude in this matter was sharply criticized, more hotly indeed in the United States than 

 in England owing to the approaching Presidential Election. A considerable body 

 of American opinion regarded the passing of the Act, without further consideration 

 for the British protest, as a reproach to the national honour, and President Taft was 

 bitterly accused of making the United States appear guilty of a breach of faith. This 

 was rather unjust, because President Taft made it quite clear that he did not consider 

 the exemption of coastwise shipping from tolls to be a violation of the Hay-Pauncefote 

 Treaty; on the other hand it was difficult to understand how, on the wording of the 

 Treaty and the Act, he could arrive at such a conclusion, or how, if a difference of opin- 

 ion existed, he could resist the British contention that a decision should be given by 

 the Hague Tribunal, as provided in the Arbitration Treaty of which President Taft 

 himself had been a notable champion. In England this naturally was the view gener- 

 ally taken. In the United States, on the other hand, there had always been among 

 the public at large a tendency to regard both the Clayton-Bulwer Treaty and its suc- 

 cessor the Hay-Pauncefote Treaty as really inapplicable to the conditions under which 

 the Panama Canal was actually being constructed; the United States was paying the 

 whole cost, and the rest of the world was contributing nothing, what right could Great. 

 Britain have to interfere? The fact was that, while the legal right was disputed by so 

 eminent a lawyer as President Taft, the moral right in other respects was clearly on 

 the American side, and it seemed absurd to Americans, on general principles, tha~. 

 they should be prevented from giving a preference to American shipping if they 

 wanted to 



So far as concerns American and British shipping, the substantial facts of the eco- 

 nomic and commercial situation might well seem to an impartial critic to make the 

 point at issue comparatively unimportant, while affording a very natural explanation 



1 The formal protest was contained in Sir E. Grey's despatch of Nov. 14, delivered at 

 Washington on Dec. 9. 



