70 AMERICAN DIPLOMATIC QUESTIONS 



established themselves as free and independent republics, and 

 those whose geographical position and topography warranted 

 them in so doing stood ready to enter into treaty relations 

 with any foreign power thought to be able and willing to 

 construct an interoceanic canal within their borders. The 

 United States had, at this time, reached a point in its national 

 existence when the entire attention of its government was 

 no longer confined to matters purely internal and domestic. 

 For the first time it was then ready to consider the subject 

 of connecting the oceans at some favorable point between 

 North and South America. The Panama Congress, which 

 had been called to meet in June, 1826, had for one of its 

 objects the discussion of this canal scheme, and the attention 

 of Mr. Clay, the American Secretary of State, was specially 

 directed to the importance of the question. Perhaps Ameri- 

 can activity was somewhat stimulated by the fact that at the 

 same time British influence was at work in Nicaragua, seek- 

 ing concessions for canal-building purposes. 



A company was quickly formed in New York, called the 

 "Central American and United States Atlantic and Pacific 

 Canal Company/' Encouraged by an Act of Congress, this 

 company set earnestly to work to present its bids for obtain- 

 ing a concession from Nicaragua before the English company 

 could anticipate it and get firmly located in the field. Suc- 

 ceeding in obtaining its concession, the American company 

 signed a contract in 1826, with the Government of the Central 

 American 'Confederation, to construct a canal through Nica- 

 ragua " for vessels of the largest burden possible." Estimates 

 of cost did not exceed -$5,000,000. Great interest was excited 

 in the United States and in Central America, but owing to a 

 lack of funds necessary to the undertaking of so very large 

 an enterprise, this, the first American effort to construct an 

 isthmian canal, served but to add one more example to the 

 long record of failures and disappointments. 



In 1830 the King of Holland, at the head of a Dutch canal 

 company, secured from Nicaragua an exceedingly liberal con- 

 cession, so liberal, indeed, that it called from President Jack- 

 son a strongly worded protest, predicated chiefly on those 



