HISTORY OF THE PANAMA CANAL 



On February 1, 1881, the work was inaugurated 

 with due ceremony. It was to be a great work, and 

 was to be handled upon a magnificent scale. It is 

 startling to read of the purchases that were made 

 and how they were made. Everything was done in 

 an extravagant and showy manner and corruption 

 reigned supreme. After seven years, in 1888, hardly 

 half of the work had been done, the company had 

 spent $400,000,000, and was bankrupt. New com- 

 panies were organized to save what could be saved 

 from the wreck. The scheme of a tide-level canal 

 was abandoned and the construction of locks de- 

 cided upon. It was announced that the canal could 

 be and would be completed for an additional $180,- 

 000,000, and the work was continued. 



Meanwhile the government of the United States 

 had been negotiating with the Nicaraguan govern- 

 ment in regard to the construction of an inter-ocean 

 canal on her territory. 



The spectacular voyage of the Oregon at the 

 outbreak of the Spanish-American war called the 

 nation's attention to the necessity for a shorter 

 waterway between our Atlantic and Pacific Coast 

 states, and the canal question again became an 

 active one in Congress. A commission was appointed 

 to report to Congress upon the matter. It looks al- 

 most as though the commission acted under instruc- 

 tions to scare the French company at Panama. 

 Their first report favored Nicaragua, after rejecting 

 the offer of the Panama company to sell out its inter- 

 est for $100,000,000. When, however, the French 

 company, alarmed at the prospect of the Nicaragua 

 Canal, reduced its price to $40,000,000, the commis- 

 sion changed its recommendation, and in June, 1902, 

 Congress accepted the offer of the French company 

 under certain conditions, and a law was passed 

 authorizing the completion of the canal at Panama. 



Then came the vexatious negotiations with the 

 United States of Colombia, of which Panama was 

 one of the states. The government of Colombia 

 endeavored to prolong the negotiations until such 

 a time that the concessions to the French company 

 would be forfeited and Colombia would be in a 

 position to possess herself of the purchase price. 

 Treaties were rejected and obstacles put in the way 

 of final adjustment until the State of Panama be- 

 came alarmed at the action of the central govern- 

 ment, fearing that the United States would again 

 turn her attention to Nicaragua. Panama had once 

 been an independent state and, if independent now, 

 could bring the negotiations with the American gov- 

 ernment to a quick and satisfactory conclusion. It 



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